Forums: Discussions for entrepreneurs and small business.

Hello everyone!!  I`ve got a situation that I did prepare for, knew it was coming, but now that it`s here, need reassurances and stories to tell me I`m still on the right track. I invented a new product and am going through all that is involved with taking an idea to market. Right now I`m smack dab in the middle of hammering out the details for my first production run in China. Right this second, with these new numbers, the cost to manufacture is way too high to sustain a business. Having said that, in my original plan, I did factor in that I would have to sell my first 500 units at a break even or even a loss just to create the demand that will drive up volume and lower costs.

In my “start-up cost analysis” I estimated my initial production run of 500 units to cost me several dollars more to manufacture then my wholesale price to my retailers, so I did figure the first run to be at a loss. (Boy oh boy am I glad I was realistic with my numbers!!) Did anyone else have to bite the bullet early on and is now running a succesful business? Please tell your story!


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Leslie
Founder and President
Charmed Life Products LLC
Grill Charms™… The MUST HAVE grilling accessory that is revolutionizing the American Cook-out AND The perfect gift for any occasion!
Grill Charms
                                                                                                    

Hi
When you say "cost of manufacturing" are you including the tooling costs, or is that a whole separate cost you need to bear?

I don`t know anything about offshore manufacturing, the costs, or so on. But I do know about "validation" versus "approval." I know about anxiety, worry, nail-biting, and wondering "am I right? Am I nuts?"

One of the things that`s kept me sane during really hard times has been that little ditty, "If you want to win big you have to risk big."

If you`ve already planned for these numbers, even if you`ve been just a bit short, you`re 90% of the way. To give up at this point would be to for the rest of your life look back and wonder, "What if......?"

So many people who`ve done this before us have faced the same situation. They`ve invested everything. They`ve risked everything. They knew that if they could only just break even, that would be the major triumph. From what you`ve said, it sounds as if you have a philosophic problem---or spiritual problem, depending on your personality.

"Do I truly believe in these grill charms? Will enough people buy them that I`ll sell 500 sets within a year? Will that generate enough interest that I`ll get additional orders? Will the business work? Do people really want these?"

Kathy had the same problem, as have I in the past. What it comes down to is the concept of "intrinsic" value. What do grill charms *REALLY* hold as a value to anyone? Not "Oh....but they`re cute." Not "Well, I really believe in them."

Grill charms are a unique way to differentiate like-appearing pieces of food on a very hot grill. The problem is routine and real, that people can`t tell without burning their hands, which steak is whose. That`s a real value, not some hope or guess, wish or personal feeling.

So your product is real. It offers a real value. Pricing is another issue, but at least you know the product serves a legitimate purpose. If you`ve sold any, or you have any sort of market research to indicate people would buy them IF they were available, then it comes down to how much do you "believe" in logic. :-)

Here`s another platitude that actually helps calm the nervous stomach when we`re grasping at straws: "It`s always darkest before the dawn."

Craig - that was a really nice post.

I thought I`d just take a moment to tell you that.

Leslie, I can feel your stress, welcome to the roller coaster of life!

Our story is a little different than yours and I don`t think I stood to lose as much financially to take a stab at it, but I still had the whole roller coaster of emotions that I believe you are feeling. I still sometimes get them today .

For us, it was a make it or break it. We were on the verge of losing everything, I had to do something and fast. I took money we didn`t have and spent it for supplies, I wasn`t really sure if it would work or not. I knew that I had bought a ton of dip mixess in the past and thought I could do as well or better than what was currently available on the market. I had to try! I say a prayer of thanks everyday that I just moved forward.

You have a great product, I can see them now in every specialty kitchen store in every mall. Think of the outlet malls popping up everyday and they all have what? at least 4-5 specialty kitchen stores. They all have grilling sections, some of the stores like Harry & David and LeGourmet (to name a few) have all the wonderful sauces and marinades and would be a super ideal fit for your product. I am sure once they saw it, they would want it on the shelf.

If you are just finding this out and still in "panic mode" give yourselve a couple of days to digest what you know. Things always have a way of working themselves out and sometimes, once you mull over it things don`t really seem as bad as they first did. I have gone back to the drawing table several times on ideas and concepts before moving forward and somehow things fall into place. I know nothing about overseas manufacturing but if it is possble to do some further checking, to see if you can cut costs by finding another supplier, take the time to do so and be at peace with your decision. Whatever you chose to do I wish you the very best and hope you decide to move forward and try. It truly believe if you can get past this that you will find success!

How many potential manufacturers have you found? Surely there`s more than one. Also have you investigated manufacture in the US or Mexico?

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I am feeling better and better with each post!  Keep em coming !!! 

 

Degrees, no, tooling is a completely separate cost.  (I’m not worried about that, because that came in under budget)  As usual, I hoped it would be lower, but it’s still in line and a little cheaper then what I had planned for.  (I REALLY inflated my costs)

 

Wow Craig!  You can really put the wind back in someone’s sails when you want to!  I DO believe in Grill Charms™ with ALL MY HEART!  I KNOW without a doubt in my mind that this product will be a smashing success.  At crossroads like this (well, this wasn’t really a crossroad, because stopping is not an option) but at a stressful point on the journey, one begins to have doubts and really… it’s all about validation.  Yep, I’m not too proud to admit… I NEED IT!  Not to succeed, because I will do that anyway, but I need it to make this nauseous feeling in my stomach go away and help me get some sleep at night so THANK YOU!  That was a really wonderful post, I appreciate it!

 

Pam, thank you for sharing your story.  I knew there were fellow entrepreneurs out there that went against the odds and risked much more than I am and have reaped the spoils of their venture.  That’s what I needed to hear. 

 

Any other product developer/inventor/manufacturer types been in my shoes???

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Leslie
Founder and President
Charmed Life Products LLC
Grill Charms™… The MUST HAVE grilling accessory that is revolutionizing the American Cook-out AND The perfect gift for any occasion!
Grill Charms
                                                                                                    

Hey Steve!  I`ve got 2 sourcing agents looking in all of Asia.  Asia is the place to go for Stainless steel.  Some counties are better then others with different materials and Asia is the continent for stainless.  So far the prices and factories that can actually handle this particular process have been in China. 

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Leslie
Founder and President
Charmed Life Products LLC
Grill Charms™… The MUST HAVE grilling accessory that is revolutionizing the American Cook-out AND The perfect gift for any occasion!
Grill Charms
                                                                                                    

Leslie
From a manufacturing standpoint, i wouldn`t expect the unit price to begin to level off until you got to 10 or 20,000 units. If you can`t make a profit at those quantities then you might need to find a different manufacture or system. For the moment, everything you are doing seems quite logical. You should be very proud that you found a manufacture that will make only 500. It might seem like a lot to you, but its just a sample run for them.

Well, my product(s) is a little different than yours, but I can relate to the fears, lack of trust in your own decision-making skills, and all those other worries... I am more of a reseller of others skills. Therefore I truly sell my ability to recognize quality, style, and usefulness.

I tell you... I saved and cut corners in every area possible in order to start my biz. I eventually bought $10K of product from a chance connection to an importer of fabulous vases and imitation flowers. I had (have) no idea what I was doing. I just really felt my friends and people in general would have a use for my earthborn & handmade products. I then quit my `day job` and started building my website (I have a background in graphic design).

After several live revisions of ElusiveTreasures.com, and much needed input from the SuN community (not to mention a few sales) I have a working storefront online.

I have now been self employed for four years. I don`t own a home yet, but I can smell the value of my business growing. The passion for distributing quality products of an earthborn & handmade nature is still pumping through my blood. As a matter of fact, the necessity to make it work has created a love toward my products. I actually feel sad, (but mostly happy) when I ship out an order.

Some ideas fail. Some ideas take years to mature... The point it. Never Give Up.


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Vincent Wilcox (a.k.a. KRAKR)
Drummer
My band: Letters Make Words