The very first step in this entire Small Business journey should be to establish your what. What is it that you’re hoping to offer to the consumer? What kind of product or service will you be delivering?
This may seem like the easy part, if you have already started delivering your product or service, but it’s crucial that you have a firm grasp on this piece from the outset. Let’s go back to the bakery we talked about last time. Let’s say that our home baker has absolutely MAD baking skills and he’s been baking up a storm for his friends, neighbors and co-workers for the last year, with rave reviews. He’s great at birthday cakes, cinnamon rolls, cookies, and cheesecakes, and he makes lemon bars that make everyone swoon. Awesome. A great start.
Is he planning to sell all of these items? More items? Fewer items? Is his cheesecake the best thing he has going? Can he modify his original recipe to offer multiple flavors? Or is he really hoping to get into the cake baking industry? Does he want to do just birthdays? Weddings? Multi-layer cakes? Cake Boss cakes? Is he an artist more than he is a baker? Or is he a baker more than he is an artist?
How can he scale the items he currently bakes? What if his cookies are his best sellers? Can he make dozens and dozens of cookies that will sell quickly? Does he have ideas for new and different types of cookies? If cheesecakes are his best sellers, how many can he make in a day? How much can he charge for them? How many does he need to sell in order to pay himself and keep the lights on? What about cakes? How long will it take him to make a multi-layer cake? How long to decorate? How many can he push out in a day? After he’s factored in his labor, time and materials, what’s his margin?
Who else is offering this same product or service? Is it a niche market in his area? Maybe no one is into making cheesecakes where he lives and folks would snatch them up like they were gold. But if there are 32 cheesecake bakers in a 5-mile radius, or a Cheesecake Factory just up the road, it might be a tough sell. If there are 32 cheesecake bakers in a 5-mile radius and none of those bakers make lemon bars that compare, that might be a better option.
These are all important questions that go into developing your what.
Looking at the baking industry, there are some standouts who nailed their what early on.
Nothing Bundt Cakes just opened its 300th location in April of this year. They offer several different sizes of bundt cakes, with nine standard flavors and special flavors offered at various times of the year. Their company was founded on perfecting the bundt, and that is what they did. They knew exactly what they were planning to offer, they got laser focused on that one thing, and they turned it into a nationwide operation.
Crumbl is another baking success story. Two cousins started by perfecting their chocolate chip cookie, branched out into multiple flavors and added a rotating schedule and home delivery to their lineup. This unique approach to cookies, that used to be a mall staple, has made Crumbl a rapid growth business. From a chocolate chip cookie testing ground two years ago to over 30 locations in multiple states in 2019. They solidified their what… right out of the gate. As a side note, if you haven’t tried a Crumbl cookie yet, get yourself on down to their nearest location, order a shipment, or get some home delivery. They are delicious!
Note: It is extremely rare to go from idea to retail sales without a test ground in between. If you have a great idea, make sure you try that idea out on some folks close to you who will give you honest feedback and who will not leave you a negative Social Media review!
Let’s review the most important questions to answer when defining your product or service.
- What have you already made or what service have you already delivered?
- How has your test market received what you have already made or delivered?
- If your product or service is location dependent (brick and mortar, local market), is it unique in your area?
- What is your best selling product or service?
- What can you do to improve or perfect your product or service offering?
- What is your worst selling product or service?
- What kind of options are there for developing your product or service further (e.g., multiple flavors of cookies, multiple tiers of service)?
- What additional services can you offer to make your product or service unique (e.g., Crumbl’s home delivery option)?
If you don’t have the answers to the above or you are not sure whether your product or service will sell in your market, don’t worry. According to an article at Under30CEO.com, Thomas Edison ” …failed to refine the light bulb (one of the few creations he merely refined but did not invent) so many times it took him 10,000 attempts to perfect. However rather than accepting failure 9,999 times he is quoted as answering questions on his failures as rather: ‘I have not failed. I have just found 9,999 ways that do not work’.” If you’re feeling like Edison just before his 10,000th attempt, go back to the drawing board, get your test market in place, pinpoint your product or service offering, and try again until you get it right.
If you haven’t yet established what product or service you’d like to offer, stop by for the next installment… What’s Your What? Defining Your Product or Service – Part 2
