That sounds like an exciting project. Good luck to you.
List cost would be $1,499 USD for the whole package. After
some time, I think that could be reduced to $999 USD.
COG+duty+assembly is around $300-$400 depending on qty ordered. 100
units would be $400, 1000 units would be $300.
Use a 4x to 5x multiplying factor. COG+labor = $400, sell it for $1600 to $2000. (okay, $1999)
Now, as you place more bulk orders for parts, the COG will drop due to quantity discounts. I just want to put just a little bit of damper on this plan (based on experience with my own manufacturing)... Yes, seeing the big savings when you place higher quantity is great, and you can see your COG can drop a lot, and you'll become giddy because of the bigger profit... :) But CASHFLOW is important. You don't want to tie several thousands of dollars in inventory more than you need to, and be cash poor and don't have liquidity to purchase other materials or services. You don't want to get to a point where you can't complete a UNIT because you're lacking in some key parts, and you can't buy the part because you don't have any money left. Meanwhile, you have $10K in inventory sitting on the shelf. (Get my point?)
There's also Just-in-time inventory (JIT). You can read more about this and it supposedly saves companies money because your dollars are not tied to inventory sitting on your shelf. You only get the inventory when you need it. Here's what... It may work for Toyota, Honda, or other big companies because they control their supply chain. It won't work for you or any small manufacturer as well as you think. Don't get sucked into this JIT nonsense. Your enemy will be "lead time" from suppliers, factories, distributors. Just because you need 100 pcs of XYZ part next week, does not mean that the distributor has 100pcs ready to ship to you. (sometimes they do, sometimes they dont). And what happens when you need this XYZ part and the lead time is 4-6 weeks? Well... you have 4-6 weeks of not being able to build/sell anything... which kills your cashflow (and that is bad.)
So find a balance between JIT and too much inventory. :) And always have some cash/money all the time (very important.)
In your opinion - do you think this product is viable for mass production?
Do you think there is enough demand for that product?
Do you want to do mass-production? You have to be realistic in your forecast. You don't have to be a big volume producer to be successful. You can be an "on-demand" or "boutique" manufacturer. You build small quantities, but at very high quality. And then you charge a premimum.... so let's make your price $2499.
Admittedly, products similar to this exist already, but are out of the price range for recreational use ($6,000 USD and up).
If yours is 10x better than the ones out there, you can probably charge $2999 - and you can still undercut your competition by 50%.
Now, whether individual boat owners will shell that sum of money for something they may only use once in a while, that's another story.
Maybe you can offer rentals? They rent it for $400 or something.
Or maybe you can do the service for them... and they hire you and your equipment.
I
forsee $40,000 USD as being a safe amount to start this project, but
would rather find sources other then my personal savings to fund this.
What avenues would you suggest I try?
Bootstrap!
Build one unit, and sell it. With the profit, buy more parts to build more units.
Build 3 more units, sell it. With the profit, buy more parts. You'd have enough profit to buy parts for 10 units.
<rinse and repeat>
Be patient. Bootstrapping is perfect for this kind of business.
You may find out that the 1st unit has some problems, or the customer requested a feature... so you can fix that problem, or incorporate that feature on the next unit you'll build.
Small refinements to continually improve the product... it's doable.
Be patient. It's not an overnight success. But if the numbers work, and you know there's big profit in it, you'll be fine.
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