Every week as SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wednesday on Twitter from 8-9pm ET. This is excerpted from my recent interview with @Jengroover. She’s a top business expert and has been tagged by Success Magazine as a “One-Woman Brand” and named a leading “Serial Entrepreneur” by Entrepreneur Magazine. Jen Groover’s signature product the butler bag has revolutionized the handbag industry. www.butlerbag.com Her has quickly become synonymous with innovation, entrepreneurship and evolution. She has gone from guest-hosting spots on QVC to linking deals with some of the industry’s biggest heavyweights. For more information www.jengroover.com
Smallbizlady: Once I have a product idea what are the first things I need to do?
Jen Groover: Once you have an idea you need to check a few things:
- Analyze the market and see if you see the idea already out there?
- If so, why is yours different, or how can you push yourself to make it more unique than your original concept
- If it was tried before was it successful? If not, when? And why?
Smallbizlady: What is intellectual property and why is it important in product development?
Jen Groover: Once you have answers for those questions, you will need to find an Intellectual Property attorney to verify legally what is already out there. Even if you don’t see something “in the market” it may be something in development and you don’t want to risk getting in trouble for patent or trademark infringement.
Intellectual Property is basically creative ideas that can be protected so that you can “own a space” in a category of business or develop enough brand equity that you can license your idea, which basically gives someone the right to use your patent and possibly trademarks to increase supply of your products and distribution channels while paying you’re a royalty to do so. You need to consult with an Intellectual Property attorney (very specific niche of training) in order to get proper representation.
Once an attorney verifies it is safe to move ahead, you can conserve costs by filing a provisional patent (if it is a patentable item) which buys you a year to begin product development and we as brand development.
Smallbizlady: Once I file for protection what do I do next?
Jen Groover: Once you file for protection whether it be a patent, trademark, copyright, etc, you will need something to be protecting the brand equity you are about to build. You begin product development by making a prototype. A prototype is an example of what your product should look like. You may need several iterations of the in order to perfect how you want your product to look and function. While you are clarifying that, you should also be devising your plan on what type of brand you want; for example is it a high-end luxury brand of a daily household affordable type brand. This will help you identify more closely the type of materials used to finalize your prototype. Because more often than not, many different grades of materials can be used but the type of brand you want will dictate that.
Smallbizlady: What is the purpose of the prototype?
Jen Groover: Aside of understanding the types of materials needed the prototype is important in helping you mold your vision for the brand by doing focus groups, talking to important decision makers in your hopeful industry (i.e. buyers, media, investors) and most importantly customers to see if there is demand for what you are making and if so, what would people be willing to pay for it?
Also, if you need to raise capital, you often need to begin at this stage because you will be needing the capital for inventory and/or marketing expenses to get the company off of the ground.
Smallbizlady: How do I determine pricing to get started?
Jen Groover: This usually begins by identifying if there are competitive products like yours already in the market; if so why are they different? What image are they portraying and do you want the same audience? or do you want to target a different audience?
Additionally, speaking to your potential customers helps you to understand what the “market will bear.”
Lastly, what is your capital situation, what type of brand can you afford to be?
Smallbizlady: I have a prototype, samples and inventory being made, should I go right to the big retailers and start pitching.
Jen Groover: Unless you have invented the most incredible widget to date or have unlimited capital or have a partnership with an A List celebrity I do not recommend choosing that path right out of the gate.
I always advise to “crawl before you walk” for many reasons. Crawling first allows you to make mistakes at a smaller scale with less to loss financially and reputation-wise. Also, it allows you to slowly learn an operations process that can be adjusted as needed. Core operations includes solid manufacturers in place with quality assurance standards, shipment, warehousing, a system fulfillment of orders for shipment and branding, customer service, etc. Without a core operations plan in tact before expanding to what would be needed for mass retailers you run a risk of falling apart before you really started.
Smallbizlady: What are the best distribution channels and why?
Jen Groover: I am often asked this question and the answer of what is “best” is different for everyone, depending on your brand, price-point, customer demographics, etc. Often what you think will be your best channel will be something completely different. One thing that is really important about understanding distributions channels is the sequence in what is typically and strategy in “build up in demand” especially for a brand new brand or product concept. A simple starting point is building your online distribution, then boutique and specialty stores and increasing your distribution slowly from there to possibly catalogues, direct response, home shopping, department stores, infomercials then big box retailers. This isn’t always the right path for everyone but a good guideline so that you can learn and evolve without as much risk involved.
Smallbizlady: How do I build demand to get interest from retailers?
Jen Groover: The best way to do this is to create buzz. The best way to create buzz is to understand PR and Marketing. Become a student of both so that you know everything about how to get media coverage, how to become and influencer, how to get your product into the hands of influencers, and how to become a walking billboard for your brand. Once you do this retailer will be coming to you to want to carry your product and the retailers you may already be working with will love working with you more and be more excited and dedicated to building your brand with you by talking about it more, giving you better placement within the store or additional store signage.
Smallbizlady: How do I get meetings with buyers?
Jen Groover: As mentioned continuously getting as much press as possible is really important to help initiate a meeting. Additionally having a unique product helps and unfortunately or fortunately knowing people helps as well. Which leads to focusing on also becoming a professional networker. If you don’t know someone find vendor reps for the retailers you are trying to connect with. These reps work with small to large companies and are imbedded into the retailer’s environment. It is their job to get to know everyone, know what the buyers are looking for, the positioning of the product category, how to present to the different buyers, price points that are effective as well as get you the best deal negotiated. I know vendors who don’t like to go this route because they have to give the vendor rep a percentage of the business but the way I see it is if you have the right vendor rep, your deal will be better, your sales will be increased and you will make more money then you will on your own not knowing “the business” the way they do.
Smallbizlady: What should I expect in a pitch meeting?
Jen Groover: Typically what you should expect is about a 20-minute meeting to pitch your concept. You should be prepared to speak in sound-bytes and present the idea in such a concise well thought out manner that the buyer would feel foolish saying “No”. DO not give your life story or long winded explanations, only relevant information. (Note: do be engaging and interesting, people like to work with people they like and will make more concessions for those people) Try to think of every objection ahead of time and have an answer for that objection, offensively, not defensively. If you have press, have it all there. If you have quotes, have them there. If you have a good sales record to prove demand, have those numbers ready. Typically when pitching a product you start by posing what the problem is that exists (or void) and how that product solves the problem or eliminates that void.
Smallbizlady: What happens if they say “Yes”?
Jen Groover: Take a moment to celebrate. Then take a moment to realize this is where the work begins. Once a buyer says yes, you will typically begin to feverishly learn all of the expectations that a retailer has about shipment and delivery. Additionally you may be in need of additional capital to fulfill that order. Often purchase orders from major retailers can be leverage in order to raise capital to create inventory. Additionally this is where you need to come up with a marketing/pr strategy to leverage the launch. Often as a new supplier, the retailer will not “partner” with you on this or invest too many resources because they will want to see how it ‘tests” before doing that. You (or your vendor rep) will need to work closely with the buyer to make they “launch” as successful as possible. This means you need to understand why and how things through this distribution channel usually “launch” to succeed.
Smallbizlady: Once I am on the shelves, I’ve made it right?
Jen Groover: On the contrary. Once you are on the shelves, you need to constantly analyze how to stay on the shelves. Conversion to retailers is all they care about. The shelf space is worth money. Staying in contact with the buyers and understanding how sales are converting and why is critical. Continuously investing in your pr and marketing strategy is critical too come up with as many unique strategies to drive traffic into the stores.
If you found this interview helpful, join us on Wednesdays 8-9pm ET follow @SmallBizChat on Twitter. Here’s how to participate in #Smallbizchat http://bit.ly/S797e
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Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of MFE Consulting LLC, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. Forbes Magazine recently named her one of the Top 20 women for entrepreneurs to follow on Twitter. She hosts #SmallBizChat Wednesdays on Twitter 8-9pm ET for emerging entrepreneurs. She also publishes a resource blog www.succeedasyourownboss.com Melinda is also the author of the national bestseller Become Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works. (Adams Media 2010)