Wednesday, February 20, 2013

If Ghost Busters Taught Us Anything.....

There are a whole raft of ways you can succeed at a business, but the universal essential key is to identify a need. That need isn't necessarily in demand right now (in fact perceived revolutionary products often hit the market right on the leading edge of demand) but that doesn't mean you need to wait for an ancient diety to open a multidimensional portal to create that demand either.

Take, for example, those poor souls who build anything related to iPhone. Okay so perhaps they're not exactly POOR souls, since they had a few good years already, following Apples products around as the key influence on their own offerings. However, how would you feel when the iPhone 5 comes out and all that new stock you had built in advance of the release, is instantly made redundant by a change in plug configuration?

Likely you'd roam through your warehouse flailing your arms like the staypuft marshmallow man wondering what you're going to do with what is now olde stock! You can't sell it to the kids; they've moved on!

Though there isn't much that could have been done in that case,  there are still examples of companies beating a dead horse for too long. These examples can be found anywhere you find heavy discounts. The product hasn't necessarily gotten any worse,  but the ads have stopped, it's no longer trending and your dad has one.

The speed of fad burnout these days is astronomical and proportionate to the increase in connectivity (which I'll discuss in an entry all it's own) which demonstrates the need for 2 essential ingredients relating to your product

1. Tie the longevity of your product to longevity of the source you used to identify the demand.

Memes for example, are only useful for nimble advertising agencies to produce reactive campaigns. You would not, however, go making ermagerd themed sheet sets.

2. Make/build/generate your stock in accordance with the forecast demand.

Monitor the strength of demand ruthlessly and most importantly, let that information drive the speed of your supply line. If you identify that your supply pipeline is too slow to get product to market in time to meet demand, the risk of being caught with dead stock should justify your investment in improving supply agility.

Remember, if you can't create or react to changes in demand, one day your customers are not going to call any more. They'll want He-Man......

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