“Shoestring anyone?” – 6 Tips for Developing Your Product on a Budget

It is possible to develop a product on a shoestring budget, maximizing the use of your time and efforts. However, eventually there will be unavoidable costs. At a minimum you can expect moulding, sample and freight fees, and before you know it you’re a few hundred dollars into the process.

It is important to budget your product development project properly to ensure that costs don’t spiral and to help you to keep a realistic grasp of the situation.

1. Know Your Spec

As we’ve covered before, an important first step is knowing exactly what you’re trying to make. This sounds obvious, but you writing a detailed spec doc is vital. This way your factory or development agent will have a clear understanding of what you’re trying to make, the materials and labour involved, and will therefore be able to more accurately estimate your sampling and production costs.

2. Know your budget

If you have a specific budget spend available for product development, write it down early on and try stick to it. If you have an absolute max you’re willing to spend to get your first prototype or sample made, let your factory or development agent know – they may be able to help you stick to the budget by offering alternative materials or production methods. If it’s your first time working with a factory, this may also serve to let them know you are conscious of cost, have a cut-off point and are not a bottomless pit of cash!

3. Compromise

We all want the best quality, the best materials and the best product. However, very few small businesses are in a position to pay for the best of everything, and if your unit price skyrockets very few customers will be able to afford your product. It’s important to be willing to compromise. We’re not talking about cutting corners and producing shoddy goods, but you may need to give up on certain things. Perhaps a gold embossed logo is adding massively to the cost where a simple decal will do the job. Maybe your fancy blister packaging is adding too much to the unit and a simpler box design will do. Again, this is where your spec doc can help – keep returning to that document to remind yourself what is essential to the makeup of the product, and be willing to make changes on the fly.

4. Give yourself a buffer

On both time and cost, expect the unexpected. It is common to have to make several iterations of samples before the product is considered ready for mass production, and even then changes will likely take place. Packaging may not have turned out as you’d expect and you’ll go for a totally different concept. A material colour may not be quite right. A label may need to be edited or a logo altered. There are more serious situations such as when molds need to be remade, but the point is that any and all changes redirect the process and cost time and money.

When setting yourself a target budget, give yourself a little buffer to allow for unforeseen changes. The last thing you want is to run out of funds and have to go scrambling for investment on the final hurdle.
We tell this to all our clients when we take on product development projects, not to scare them but to manage their expectations and keep the process within their realistic budget and time targets.

5. Know when to stop

The common theme of the points above is how easily it is to get lost in constant alterations and revisions. Product development is a process, so undoubtedly you’re going to come up with new ideas and improvements as the work progresses.

However, sooner or later you have to let your baby go and get the first sample made, or sign off on a pre-production sample so you can place your first order.

That confirmed sample will be the difference in getting that investment for initial production or for your crowd funding campaign. Focus on getting something nearly perfect so you can show it off and prove your concept to those all important financial backers.

6. It never really stops

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Sometimes you can’t do everything you want to on a first sample run and may need to shelve certain aspects of functionality, colour range or overall look. All is not lost. Take note of those great ideas and save them for the next phase of your product development.

Remember that despite agreeing or confirming a product for production, product development never really ends. You’ll already have ideas for the next generation or have a plan in place to stay ahead of your competitors and how you expect the market to react to this new product.

So once you’re in development, keep the pen in hand, a plan in mind, and stay flexible. Or as the famous Monty Python phrase goes: ADOPT, ADAPT and IMPROVE.

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