There is a saying that is often heard among entrepreneurs that sends a very erroneous message. That bromide is that "If you build a better product, the world will beat a path to your door." On the other hand, there is another old saw that warns against reinventing the wheel.
For the entrepreneur, both of these sayings touch on the issue of new products and their introduction to the marketplace. The dream of many individuals and small business owners is to come up with that one product that could change their lives overnight. The reality is that the process of getting a new product out the door, and successfully in the hands of a consumer is one of the most difficult challenges of the free market system.
For example, the patent office has literally hundreds of versions of the same product in its files. Supposedly, many represent improvements over the classic. Yet, go into any hardware store and you won't see but one or two options other than the traditional spring and clamp. Likewise, there are those who make billions of dollars by continuing to improve upon the wheels and tires that move our vehicles.
The Barriers to Entry and Hurdles to Success
The economists use a term that describes the difficulties of entering a market, barriers to entry. Some markets have high costs to even try to compete, such as manufacturing automobiles or big-screen televisions. However, even if a great market exists with real opportunities, the road to success has many hurdles.
These challenges to any small business and entrepreneur include:
- Distribution. In mass retailers, the mantra is "shelf space." Getting a new product on the shelves of a retailer is a tremendous challenge, even for large, established companies. The Internet now opens doors that didn't exist just a few years ago, but distribution is an essential consideration for new products.
- Timing. In a word, it is everything. A small business can seldom afford being even a little late or early for a market. Often, a killer concept one month is a dust collector only months later. With all the issues of getting to market, hitting the timing issue right is an incredibly difficult challenge.
- Marketing. This area has one ray of hope - again, the Internet. Companies that use social media effectively have an opportunity to gain a viable customer base. Most entrepreneurs greatly underestimate the cost and challenges of this aspect of product introductions.
If you are thinking about building a different product, do your research and thing long and hard about the challenges of introducing it.