There are more unknowns than knowns when starting a business. While your business plan is filled with market research and 5-year projections, you don’t really know how things will pan out. This uncertainty causes hesitancy for owners around what products to sell, how many services to offer, or when to roll out new products.
I recently spoke with someone who was opening a brick-and-mortar franchise business. The franchise specialized in one core product with value add offerings to go along with it. This individual wanted to launch with only the main product, and run business for a while before selling the other ones. On one hand, it’s a good idea to smooth out operations, get a feel for your customer base and make sure your staff levels are optimized before launching additional services or products. There are, however, some downsides with this approach to consider, as well.
Why You Should Wait To Add New Products & Services
Established customer base: It is easier to introduce and sell a new product or service to people who know your brand. There is less marketing involved, and the sales cycle is shortened.
R&D: You have opportunity to test out new products on your customers, get feedback, and optimize it to fit their needs.
More is not always better: You may find that having more products to sell cannibalizes your core offering, which could lead to less than expected revenue, more waste, or an increase in expenses.
Why You Should Not Wait To Add New Products & Services
Franchise model: If you operate a franchise, the Franchisor has already done the product testing for you. New products aren’t introduced to the system if they aren’t profitable.
Capital: New products may require additional equipment, store reconfiguration, and marketing. It may become more difficult to justify spending money on introducing new products or services as time goes by.
Good intentions: Be careful as a business owner when you hear yourself saying, “I’ll do that when….”. ‘When’ might never happen. Once you hit the ground running with a new business, you have to be ultra disciplined to take time to work ON your business; testing new products, creating marketing strategies, and designing new services can get put on the back burner when you are working IN your business.
Either way, you should have certain metrics in place to signal when to bring on new products or services. You could hit these metrics in a matter of months after opening, or the “right time” might get pushed further into the future.
In order for a business to grow, I’ve found it’s necessary to bring on new products and services.
Do you agree?
What has been your experience with launching new products or services in your business? Let us know.