Faygie has enjoyed baking since she was 8 years old and would often join her mother in the kitchen in baking for the family or guests. She especially enjoyed the compliments she received from her friends and family for her baking skills. In recent years, her flavored biscotti was getting many rave reviews including one from a local professional baker who suggested that she might want to bring it to market. Now newly married and looking for a business to support her husband studying in Kollel, she wondered whether she could in fact turn her passion for baking and great recipes into a business. According to Harvard Business School professor Clayton Christensen, there are over 30,000 new products introduced every year, and 95% fail. Faygie was convinced that she would be amongst the 5% who were successful and not the 95% who failed.
With the support of her family, including some financial help, she created a company name. Next she proceeded to perfect the product, even renting time at a commercial kitchen to continue testing her products, which she ultimately made in 5 flavors. Meanwhile, she hired a consultant to help her find a co-packer and then it was on to a lab to provide her with the information for the ingredient panel and a marketing consultant to plan her strategy for getting her products on bakery and grocery shelves. Finally, she met with several potential distributors.
One consultant asked her a key question that experts say is essential to answer before proceeding with a new idea. What problem will your product solve? “Taste,” she instinctively answered, meaning that the blend of flavors she came up with will solve the taste problem. This is in line with the advice of most experts that a new idea or product must solve a problem to be successful. Amazon, for instance, solved how e-commerce was, at one time, expensive and inconvenient. Today, it has more customers (and sales) than its brick-and-mortar competition. One business article succinctly said: “How will your idea or product make life better for the people who will use it?”
So, what is Amazon’s advice for testing a new product? “You should talk [to] and/or survey at least 50 potential customers to see if they identify with the problem the same way you do,” said Wayde Gilchrist, a senior technical manager at Amazon. “In other words, you need to find out if this is a real problem for a majority of your target market or just a few.” While she did not test her product with 50 people, she did offer it for tasting to at least 20, including a big kiddush in her shul.
Faygie would be happy to know that people who enjoy baking can now benefit from one of the best new products in 2022, GE’s Smart Mixer. It features Auto Sense, built-in smart scale, voice-control capabilities, guided recipes and more. Says GE: “Our powerful stand mixer blends classic features with smart technology so you can master the most complex recipes with confidence. It will help you enjoy baking like never before.”
Technology continues to be a leading category of new products and ideas. Although there may not be any new revolutionary phone on the market, for example, innovators have turned their attention to aids and auxiliary products that help use a phone. Take for example OtterGrip, which makes it easier to hold a cellphone. This mobile marvel has its own grip that pulls out and presses flat in place, making it hand friendly. Says the manufacturer: “And since we built in an array of magnets, it’s MagSafe ready. OtterGrip is a fusion of the practical and the magical, a smart surprise that gives you a deeper connection with your device.” These products, including special luxury cases, have developed a life of their own.
Identifying the market, say the experts, is another essential exercise as part of the necessary research prior to successfully introducing an idea or product. The professional baker advised Faygie that she should focus on ages 30-50, coffee drinkers, and people who enjoy her special flavors. He also suggested a focus on coffee shops. Good research is crucial and can avoid many problems later.
Many people with a good concept or product have an idea how to finance the initial phase of starting a business. In Faygie’s case, her family put up the money for the attorney to start the business and for the consultants. Going forward, she wasn’t sure whether she would consider a working partner or simply manage the business by herself and raise more capital by finding a “silent” investor. This can be a challenging question for most entrepreneurs.
Paul Graham, co-founder of the startup incubator Y Combinator, said that having business partners has several benefits, especially when first starting out. “They can act as support, a sounding board for your ideas, and provide evidence to others that you actually have a good idea.” Faygie decided against taking in a partner especially since at least two of the co-packers she was considering seemed to want to help her and were only too anxious to volunteer advice. Here is some of the advice of professional consultants:
- Testing your business idea is key to seeing if it’s a viable business model.
- Don’t rush into launching a product without careful consideration and planning. If it fails, it could be a waste of critical resources.
- Building a prototype and creating a marketing plan can help determine whether or not an idea has potential.
“Although you’re no doubt excited about your new business idea, you might want to wait a while before fleshing out a potential idea,” said Greg Isenberg, CEO of product design agency Late Checkout. “After I’ve gone through the process of writing down a bunch of ideas, I don’t like to rush into building a business plan or recruiting the team,” Isenberg said. “I like to wait a few weeks [to] see which ideas really stick with me.” Isenberg said he only moves forward if he has a burning feeling that the world genuinely needs his idea.
“Identify people in that target [audience] you know to be skeptical and critical,” said Chip Bell, founder of business consultancy firm The Chip Bell Group. “These people could be irate customers from previous encounters or friends who always take the glass-half-empty perspective.”
The upshot of all the advice: Don’t go into a new business half-baked!