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Section 10.1 Product
Depending on the product, packaging can influence its safety and
quality. Breakable items need more packaging than sturdy items. This
can increase the cost of the product. Weight and size of the package
may affect the expense of shipping or storing.
Some products are subject to labeling laws, which require listing
contents and the country of origin. These laws especially affect foods
and clothing. It is necessary to research the legal requirements for
labeling products. When selling products globally, laws related to the
product may differ from laws in the United States.
New Product Development
The business is going well and you think it is time to add a new
product. Sounds good, but do not jump too soon. Make sure it is the
right time to add a new product. Research is necessary to make sure a
new product or service is the best business decision. Confirm that the
business can financially support a new product and that the product
will generate sales.
Product life cycle is discussed later in this chapter. After a product
completes its life cycle, a new product or service may be needed
to replace lost revenue. Develop ideas for new products or how to
improve old ones. Generating ideas and brainstorming are discussed
in chapter 2. Many of the same steps used to create new business ideas
will be repeated when creating a new product.
Generate Ideas
Brainstorming is a good way to start generating ideas for new
products. Observe, think creatively, and bounce ideas off others. What
new product or product improvement makes sense for the business?
Conduct Research
Conduct primary and secondary research to learn whether the
product will meet customer needs and wants. Talk to people in the
industry, research trends, read articles, and gather information. Pay
attention to social media discussions and what are the current trends.
Investigate a Concept
Talk to the target market. Send surveys or hold focus groups to
discover how to meet the needs of the market. If the first new product
idea does not test well, develop another one.
Analyze the Finances
Research the cost to bring a new product to market or to revise a
current product. Are funds available to create and market the product?
Look at the market research to see if the product will generate enough
sales to cover costs and make the desired profit.