Re: importing product

In a message dated 4/9/05 2:12:18 PM, mavinmay@yahoo.com writes:

I have several ideas! My main product is a workmans tool, kind of an
ergonomic device.
I have been reading your book, and setting up my home office. I have
also been going to Home Depots and quietly asking if they have what I
am looking for-they all say "no, someone should make one!" I have not
yet talked with any buyers yet. I am afraid to tell too many people
what it is, but I have to get some help somewhere! Do you know of any
good ergonomic designers at the U?

***Time limitations and demands for clarity being what they are, perhaps I
don't fully explain this point. I'll try now:

There is a difference between small and large business, or "innovators" and
conservators." We innovators bring out the new, the better. We experience a
problem in a field we love, form a hypothesis ("it's a good idea and does not
exist"), we test the hypothesis (we shop for our idea) and then if we are told
independently by those whose opinions matter, we form a theory that this will
sell. Then we test the theory by seeing if we can get enough orders from our
customers to cover the supplier's minimum production run, in a workable amount
of time, profitably. Yes, or no. If not, then we learn why not, and
literally go back to the drawing board, start over, until we get it right. The
value
to the retailers is we bring new useful products to those stores, something
they are desperate to find.

To the suppliers, who we select from the best in the world, our value is for
us to test a new idea, a new trend. First rate suppliers put plenty into
research and development to find new products. Their biggest, most popular items
are under competitive pressure, so they are always searching out new,
marginally more profitable items, and directions that will ever grow their
business.

The supplier's minimum is a compromise on the part of a supplier: somewhere
in between "enough to get a proper test" and "not so much to upset my present
operations." Your value to the supplier is to test new ideas in your markets.

If and when we get it right our products naturally show up in top tier
retailers, where the new is most desired and the premium price we must charge to
cover the lack of economy of scale. glasses may be $1.50 at Walmart, but our
glasses are $75. Walmart does not want our product.

Of course, as we are successful, and as we ever improve our items, we gain
more and more market share. As we do, the conservators see us, step in and
"steal" our item... or at least this is what the intellectual property rights
lawyers will tell you may happen. This process takes years and years. In fact,
as the huge coporations study the posssibility of stealing your item, it is
becoming unintersting to you.

First, as it becomes more popular, it provokes imitators of a sort that cause
you to lower your price to compete. These imitators haven't stolen you idea,
but they are a lower cost alternative. Second, as you strain to keep milking
this dying cow, you see there are so many other newer, better, more
profitable items to promote. Less risk for more money in less time.

Second, when a huge company steals your idea, they apply their economy of
scale to the item, economies of scale in manufacturing, finance, distribution,
and many more... and make the product available to customers you could not have
ever reached anyway. Serving these customers, the conservators serve people
that you would never had sold to anyway, so what have you lost? On the other
hand, the conservators provide the objective good of your idea at a lower cost
making it available to a far wider group of people. Material progress comes
in the form of price reduction.

So, two points for you: One, get your idea to upscale stores like
brookstone, city peoples mercantile in seattle, Molbachs and Smith and hawkins.
See if
they like it cuz they are your natural upscale customers. Second, pray and
hope that someday a big company steals your idea. it will mean you are among
the best.

John

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Beer Design

Folks,

Here is a good article on what I argue is the best way to go...

http://biz.yahoo.com/weekend/beer_1.html

John

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