Consider These 3 Things Before Selling Your First Product
/
Anyone can come up with a product idea, but that doesn’t guarantee it will be a success. On paper, any idea can seem fantastic. Then, when translated into the real world, it flops. For your startup to be a success, you have to ensure your products will sell well. So, here are a few things to consider before you launch into anything:
Can you meet the MOQ?
Selling a product isn’t as simple as getting your hands on something and distributing it. Many people are involved, including the manufacturers. Now, if you’re wondering, what does MOQ mean? It stands for the minimum order quantity, which is the least amount of units you can order from the manufacturer. This is important as it basically sets the bar for how many products you need to sell.
Say the MOQ is 500, can you realistically sell all of those products? If the demand isn’t high and you sell 100, you’ve got 400 wasted products in a stockroom. Do your research to see a genuine demand for your products to be sure you meet the minimum order. Ideally, you want to surpass it, but meeting it is the first step.
How much does it cost to sell your product?
It’s easy for a newbie to look at businesses and assume that selling products is easy. However, it actually costs a fair bit of money to sell a product. Typically, you have the following costs to worry about:
Manufacturing
Marketing
Cost of labor
Business overheads
Delivery/shipping
All of these things add up to tell you the true cost of your products. The number one business mistake is selling a product based solely on how much it cost to build. This is extremely important, but you have many more costs to take into account. It’s a very tricky process, and you should hire an expert to help you work out the cost per unit. From here, you will understand how to price your products to get a profit. Again, this is tough, but that’s another discussion for a different article!
Who’s buying your product?
Or, to put this another way, who is your product aimed at? Funny enough, this links back to the first question on whether you can meet order quantities. You must understand your products' target demographic as this directly influences the sales potential and your marketing strategy. For example, marketing something to a teen demographic means you have awesome sales potential as the teenage market is full of potential buyers. But, if your product is aimed at a very niche market, it might sell, but you’ll struggle to see massive figures. Think about who your product is aimed at before you get into the business of marketing it or ordering any quantities.
If all of this sounds complicated, that’s because it is. Hey, if running a business was easy, everyone would do it. Ask yourself these three questions before you launch a new product on the market. They should help you figure out if it is destined for greatness or not worth the risk.