With the rise of e-commerce, many businesses are choosing to sell digital products and services rather than physical goods. While digital products may seem more affordable because of the lack of traditional overhead, manufacturing and storage costs, selling a physical product still offers a number of benefits for entrepreneurs.
In most cases, physical products are designed just once and then mass-produced at a fraction of the cost. Additionally, physical goods are often easier to brand and patent than their digital counterparts. Finally, consumers can easily display physical products and loan them to friends who might be likely to buy from you in the future.
Still, despite their many advantages, the process of building physical products can be complex. Here are a few tips to help aspiring entrepreneurs build their physical products more successfully.
1. Do Your Design Research
Before building a prototype, it’s important that you do your research. Take the time to survey actual consumers and determine what they like and dislike about similar products in the marketplace. You can also use sites like SurveyMonkey to query qualified respondents about if and how they would use your product. By knowing which of your audience’s needs are not being met, you can tailor your product to meet an existing demand.
2. Know Your Intellectual Property Options
Do research into the type of intellectual property protection that you will need for your product or for any of its innovative features. Most physical products will likely qualify for protection from a patent. But if your offerings contain other creative works, like a song or a logo, you may need to file for a copyright or trademark, respectively. Once you’ve applied for the proper type of protection, you have a foundation to license your product in the future.
3. Build the Right Prototype
Once you’ve completed the research phase, it’s time to build a prototype of your new product. Take care to assess the prototype’s purpose before you start the building process. After all, an initial prototype designed to evaluate function and appearance will look very different from one created to sell to customers or to rally financial support from investors. You should also take steps to protect your product by using non-disclosure agreements when discussing it with potential investors or distributors.
Even though the price of building a prototype may dissuade many entrepreneurs, businesses should keep in mind that the cost of mass-producing future copies of your product will be significantly less. Spend a little more now, and create the best possible version of your product.
4. Be Selective About Sourcing
In some cases, it may be possible to source parts for your prototype instead of building the entire product from scratch. After designing your prototype, take the time to evaluate various suppliers and manufacturers. The savvy entrepreneur will also attend industry trade shows to find sourcing referrals while making valuable connections in their fields. Additionally, entrepreneurs can find source parts on sites like ThomasNet.com, which lets them search more than 106,000 product catalogues in a single location.
5. Manufacture Your Physical Product
These days, entrepreneurs don’t have to be skilled manufacturers to build physical products. Businesses can also send their designs to a trusted builder to ensure the final product meets their expectations. Sites like MFG.com connect product designers with manufacturers that possess the equipment and skill needed to build their prototypes. Even better, entrepreneurs can post their CAD drawings for free and choose from various bids.
6. Limit Initial Inventory
While it’s important to set up a manufacturer early on, you should refrain from producing too much product too quickly. Not only will you be left with the bill for unsold products, but you will also be responsible for storing them. Start out manufacturing small batches, and grow your inventory when demand exceeds supply. Limiting your initial yield saves you money in case you have to make changes to early versions of the product.
Building a physical instead of a digital product may seem like a daunting task, but the market for selling physical products isn’t anywhere near dead. Physical products offer a number of advantages for clever entrepreneurs that know how to solve a pain point. Do your research, protect your idea, stay involved throughout the design process, and produce only what you can sell to ensure a great return on your investment.