Starting a product-based business is not easy. Manufacturing and selling a product involves setting up production, business systems, and a sales team. It is exciting, challenging, and includes a lot of hardworking. knowing what motivates you is key to starting a product-based business.
There are hundreds of different possible answers to this question. You have to find the right answer for you. It is hard to have money be your only motivation in the challenging moments you will face. Here, we explore 10 crucial things to consider in starting a product-based business of your own.
10 Steps to Follow to Start a Product-Based Business
#1. Check Your Business Idea
Before starting, check your idea twice. After developing the idea of the product, check your potential competitors in the market, both direct and indirect. Define your ideal consumer demographic.
#2. Get Market Feasibility Repost
Starting a product-based business includes manufacturing, sales, marketing, accounting, and HR operation. You may have a great product, but are you in the right market? Having a market feasibility report prior is highly recommended. It will define your distribution mechanism, pricing structure, and other business variables.
#3. Craft A Business Plan/ Project Report
A business plan is crucial in starting a product-based business. Without having a solid business plan, your business is ready to fail at any moment in time.
#4. Get Right Licensing & Registration
Your legal structure will depend on the liability you are willing to take, the number of investors, the tax structure, etc. Choose the right form of the organization according to your need. Obtain proper licensing according to your location’s rules and regulations.
#5. Fix a Location
Your warehouse or production location is important. You need to think about moving the product from your base to the market. Also, think about the nearby availability of raw materials.
Related: How to Select a Factory Location
#6. Make an Operational Plan
Look for channel partners. Else you can promote the products through the retail store. Get the ingredients and raw materials source. A specialty product, must not be overly distributed as it could lose its perception as a specialty good. A mass-market product, on the other hand, must be distributed with consumer convenience as the prime consideration.
#7. Protect Your Product
Protect your product through intellectual property rights. Patents, trademarks, and copyrights are the common ways. Protect your brand name and logo.
Pay attention to packaging. It will be one of the first things a potential buyer sees. For the consumer, it will be all about appearance. Your product must be designed and marketed to clearly demonstrate how it will satisfy an unsatisfied need.
Pricing has a major impact on your success. Fix pricing carefully. If you fix to price, too high and you will rule out many customers who cannot afford it. Price it too low and people will doubt its quality.
#10. Develop Follow-up Products
You can’t stop at just one product. Very few companies survive on just one or two products. You have to keep adding new items every year in order to stay relevant and ahead of the innovation curve.
Questions To Ask In Starting a Product-Based Business
- Why am I doing this?
- Am I ready to take the risk of my finance?
- Who are my consumers?
- how much do I love this product?
- How much money can I access? And how much will I need?
- What lifestyle do I want?
- Who will help me?
- How will I handle setbacks?
Out of every 7 products, only 1 succeeds. Bake enough profit into the pricing. It will keep afloat in case of damage, errors, and returns. Retailers often pay small businesses last, so expect cash flow delays and stay lean. If you are honest with yourself, starting a product-based business is a lifetime opportunity for you.
Editorial Staff at NextWhatBusiness is a team of Business Consultants having years of experience in small and medium scale businesses.