Three Steps To Business Success -Supply Demand And Fulfillment
It is difficult at any time to launch a new business but in the current depressive business climate you could think that it is foolhardy. Here we are looking at how to approach this with the best chance of success.
First of all you need to understand the three elements of a successful enterprise – supply demand and fulfilment. Without looking into this at macro level they are the three principles which must be successful otherwise the business will fail.
Supply – Sourcing a supply that is dependable is vital, launching a business having two great months and then running out of stock is business suicide, in addition the price of your supply also needs to be at the right level to enable good margins that will sustain growth.
Often quality will be a very important element, for example with our new venture into sports nutrition we have opted for a more expensive European whey protein because it will taste better and mix perfectly. The trade-off here is that the product will sell for a higher price as its quality is recognised whereas a cheaper whey protein product will be seen as inferior.
With our new whey protein enterprise sourcing high quality products at the right price was very difficult due to the niche nature of the industry. In addition there is a shortage of product and a lot of demand and so the stable supply aspect is more critical than ever.
Here we can see shopping shelves, they need to always be stocked, this is no different with your online store. If the supermarket keeps running out of your chosen everyday products you would soon end up shopping elsewhere and this is the same online. Make sure your supply is secure, is of good quality and is on the shelf at the correct price.
Demand – This equates to sales if you convert it, it is again a vital element, there are many different ways to create demand and this will to a degree depend on the product or service and the industry.
With our new product launch we are going to utilise a variety of techniques, using our online marketing skills we will target natural search, local search and of course PPC where we have a wealth of industry knowledge and experience. The sports nutrition world is very competitive but is also a good industry to create social media awareness and buzz.
In addition we have tested a wide range of innovative offline advertising techniques and these have been very successful. A raft of activity should develop a healthy demand early on and this should compound as relationships are developed with new and then returning customers.
Fulfilment – Do not underestimate the importance of quality fulfilment, bad service here is the quickest way to lose customers who have made the decision to buy from you and this is probably the worst sin in the world of online selling. Losing a committed customer through poor delivery is also a waste of resource after all there was a lot of activity and effort needed to get that customer to commit to buy.
Your website must have a really credible fulfilment process, with our new whey protein project we have a complex shipping matrix that offers different options based on location and weight. This is important as it allows you to leverage cost effective delivery costs which can influence net profit margins considerably.
Other Considerations – Expertise in house is very important so if possible ensure you have direct access to specific industry expertise, this is usually best if you are not having to buy it in. In terms of a spring board it just gives an edge coming to market knowing what needs to be done rather than paying alternative agencies and not knowing what is really being done with the associated expense.
The knock on effect of this will be cost savings that can be passed onto customers and that in turn will also provide early market penetration. In our current challenging climate it is more important than ever to get the three principles implemented to a very high standard.
Branding is very important, and two brands Ninja Tracking and Protein Lifestyle have very strong branding and imagery. Be bold and stand out from the crowd, getting noticed is very important and holding the attention of visitors is critical to success. Checking bounce rates in your website analytics is important, it will assist your understanding of problem areas especially where people are leaving the website.
The look of the Protein Lifestyle brand is strong, in an industry that is congested the brand makes a bold statement of its USP and clearly send the message the brand is directed at peoples lifestyles. Launching into an industry where your brand is completely new and unknown is a real challenge. You need to give people a reason why they should buy from you and not where they normally go.
Predatory pricing is one way but do not rely on this as it erodes margins and could eventually undermine your brand as being just cheap. Product packaging and imagery is also really important, certain products will benefit from the cliche that they should ‘do what it says on the tin’, an example of this in practice is here -
High Position have always ensured that its product enterprises benefit from strong supply lines and we strive to develop good relationships with our suppliers. It is also wise to second source a good quality backup, build a relationship there too and order some products to keep the relationship warm. In the current climate even the best suppliers can have problems and you do not want to be left high and dry.
So in summary make sure that you find and protect your product source, ensure that you have a marketing plan that will deliver your demand, make sure that marketing plan covers both online and offline activity. Get your website setup so that shipping is automated in its management and that it can offer the most cost effective solution for your business when people are having products delivered.
Customers are fickle even in times of prosperity, we are currently in a long term recession and so to succeed in this climate you must be at the top of your game.