The selection of the
right product or service is critical. In fact, the choice of
a product or service for your
business
can make or break
your
business. Choose a product that requires
significant production capital when you have none and
couldn’t find any, and your business is compromised from the
start. Offer a service that a hundred other entrepreneurs
offer in your locality and you may find it hard to get
noticed above your competitors. Or select a product with an
extremely specialized market yet you do not know how to
reach the potential customers, and your business can go
kaput.
Your products or services define your business. Your
products are your business! If you want to turn your
business into an income-generating machine, the first step
is to choose the right product or services to sell.
With the right products, you even stand a better chance
at keeping your customers. The idea is to keep your
customers forever by continually offering them a valuable
product or service, thereby diminishing your costs of
reaching and appealing to them. Wise product selection is
therefore critical to your business success.
How do you choose the right product to sell? Here are a
few questions to help you narrow your focus and hopefully
select the product that will work for you:
1. What are your primary
considerations for choosing a particular product?
Make a list of
your selection criteria, and what you think are important to
you in identifying what business to engage in. There are a
myriad reasons for selecting a product, and these reasons
can include: financial benefit to your business, relatively
low investment requirements, positive return on investment,
fit with present strategy, feasible to develop and produce,
easy to source and procure, relatively low risk, and time to
see intended results.
2. Can you meet the needs of the
customer and solve a specific problem?
Your product must
address a need or an opportunity. You need to know how your
products or services can assist customers. It must have a
real value that customers can recognize, want and need.
Include in your product information and sales materials how
your products can benefit the customers, e.g. help reduce
time, effort and expense.
3. How capable are you to
produce the product?
Just as an athlete needs to know his physical condition
before he enters a race, you must also know if you have the
time, resources and capability to produce your product. Many
entrepreneurs make the mistake of going forward with a
business idea only to find that they cannot afford the
manpower required, or do not have the resources to outsource
the product development. As a result, many experience
slippage in release dates making the mistake of launching
half-finished web sites. You must also evaluate at the onset
how you can scale up the production if there is a strong
demand for the product.
4. What is the size of your
potential reachable market?
You need to at least get an idea of the size of your
market. Know who are likely to use or benefit from your
products. If you are selling an information product on how
to sell at eBay, define who will be your potential customers
you think will be interested in your product. Many small and
home
business entrepreneurs view market
research as an unnecessary and expensive cost, but
understanding who and how big your market can pay off in the
long run.
5. Would you need to comply with
new laws or government programs?
New laws or government programs can impact your product.
Some products can be sold immediately without the need for
government approval. Others, however, require permits,
licenses and approval from the government.
6. If a similar product exists,
can your product be superior in its functionality,
presentation or marketing?
This entails knowing and understanding your
Unique Selling Proposition . Your unique selling
proposition is the one thing that makes that your product
different than any other. It's the one reason they think
consumers will buy the product even though it may seem no
different from many others just like it. It may be that the
product has a lower price or more convenient packaging, or
it may taste or smell better, or last longer.
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