Do The Homework On New Products
Small businesses are always looking for ways to innovate and bring new products to market that can help expand their reach and boost sales.
But expansion of any kind in a down economy is risky, so if you’re looking to add new products, you need to make sure you’re not overextending or undercutting your core brand or resources.
“You want to make sure that whatever you’re doing to expand on your core product line doesn’t contradict it or hurt it in some way,” says Ed Geiselhart, director of product development and planning at Insight Product Development in Chicago.
New product lines, particularly product enhancements, can cannibalize sales of existing products and divert valuable resources into products that may or may not reap any return, he notes.
On the other hand, your existing product line may be past its prime and a product extension may be just what your company needs to boost profits.
In any event, you won’t be able to assess whether a new product line makes sense without doing careful market research, notes Ken Morrelly, president of the Long Island Forum for Technology in Bay Shore, which assists local manufacturers in their growth and development.
“You need a good understanding of the market,” he explains. “You need to assess your strengths and take a look at cost and viability.”
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