Agree? You can't build a top tier physical product without Money

[PizzaOnTheRoof]

Three words: Steady incremental growth

Take your watch brand for example.

I don’t have thousands to pump into product development and design, so what do I do?

I start small.

Instead of selling complete watches, I’ll only sell watch straps, but they’ll be the best damn watch straps ever seen.

A year later I have a steady stream of sales and brand recognition to develop and launch my first complete watch.

Everything takes money. You just have to get creative.

 

[Kak]

Ok..., Name some products/brands that has low cost and has top tier quality. Highly doubt you will find it. No excuses at all. Give me examples and prove me wrong.

I don't owe you an explanation. You are wrong in several ways.

First of all you don't need to self finance every business you start. That notion alone is ridiculous.

Second of all, it does not need to be top tier quality to be a thriving business with happy customers.

Which company would you rather own Rolls Royce or Kia? Citizen or Patek Philippe? Walmart or Bergdorf Goodman? Amazon or James Edition?

This entire argument is nonsensical. I launched a VERY high quality hand crafted product on Amazon about 5 years ago. I did very well for a while. Then the Chinese items entered the market full force. It was impossible to compete with this high of quality. My costs were a little higher, but my item was way better. In photographs that is hard to differentiate. To the customers, you could get "more value" for less money with a competing product. Set them side by side and you would never buy the Chinese one.

The consumers are ABSOLUTELY moving to the lowest cost, shit quality end of the spectrum. Look up any item on amazon. The number #1 result will be within 10% of the lowest price for that item. The first second and third best selling wrist watch on amazon are under $15. They are ALL rated 4 stars or better. You need to go 7 items back to even get to $30. There isn't a watch on the first over $100... Tell me again why TOP QUALITY is the paramount ingredient to a successful business?

 

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[biophase]

Really? Please show me examples then of something that has low product development and unit cost and is actually a top tier product in terms of quality.

I just met a guy a few days ago. He makes high quality leather belts from his home. Sells them for alot of money online. Is there alot of capital needed? Not that much. Go buy good quality leather. Have good skills in cutting, hole punching and stitching. Buy high quality buckles. Put them together. Most of the quality comes from the labor, not that actual cost of materials.

So I just looked on my desk and I see my wallet. Nothing special, a nice leather wallet. I don't know much about wallets, but I'm going to imagine that a top tier wallet uses nicer leather and stitching. How much product development would go into this?

BTW, just a coincidence that both my examples happen to use leather. I have at least 10 other examples that I can think of... but I can't divulge the products.

Your problem is that you think that just because you can't do it, that it is impossible. Then your mindset reinforces the thought and it eventually becomes a fact in your brain and out pops a thread titled... "Agree? You can't build a top tier physical product without Money" or "Agree or Disagree: Entrepreneurship is a privilege". You hope that people agree because then it means that you were right and the failures were not your fault.

I can't dunk, I tried to alot when I was younger so... Agree? You can't dunk unless you are over 6' tall

 

[Kak]

Disagree.

The entire post reads like an excuse.

 

[Get Right]

Entrepreneurship is for me............My products in the past had to be canceled because I just ran out of cash. Literally paycheck to paycheck for the business. People only invest in large economies of scale products.

These are not things entrepreneurs say.

If the problem is running out of cash, entrepreneurs find money.
If the problem is the paycheck, entrepreneurs change it.
If the problem is other people, entrepreneurs look at themselves as possibly wrong and fix their mindset.

Entrepreneurs are problem solvers. That's what we do and how we get paid.

 

[MJ DeMarco]

FYI: The OP only visits here when he needs to prove his excuses.

 

[Rabby]

You said there are only two factors going into a product, time and money. This is false, and a belief that will hold you back severely. There is also expertise, operational efficiency, and capital other than money. At the very least. Those can make you competitive.

What do you know about materials or design or motion that every amatuer watch afficianado doesn’t know? What special equipment or process have you developed, or at least sketched out?

You’re getting quotes from manufacturers to make ‘your’ product. You expect them to bring all of the equipment, motion design, watch expertise, material sourcing, and time, right? Perhaps even CAD? In that case, they expect you to bring the money, yes, because they are doing everything else. So like @Kak and others mentioned, learn enough about finance to make that work. Or learn about materials, motion, process, design, or something else of value that you can bring.

Now, hopefully that makes sense. You also implied that someone has caused you to have delusions that money would “just appear” if you were positive. On the one hand, I want to say that you don’t sound very positive in your approach — you’re ruling out possible futures by defining them as impossible. But that’s not really the thing. The thing is that you’re stuck on money. I think you may have a money hangup. I’m not trying to sound insulting, so read this as one person being frank with another, that’s all.

Money is not a solution. It is a proxy for other things, a placeholder for useful stuff. If you think more money will fix your business ventures, you’re probably fooling yourself. It’s true that costs usually scale down with volume, but problems also scale up. If you can’t get the business off the ground at a small scale, it’s likely to go worse starting with more.

It isn’t the money that’s the problem, it’s the things. Equipment, expertise, materials, sourcing, negotiation, design, operations — somewhere in there you can find problems. For you, I would recommend rethinking your business ideas in terms of how you can run them, real businesses, without using money. Probably sounds stupid to you, but here’s why. You need to think about the things that aren’t money, and pretending that money doesn’t exist will force you to think them through. You’ll also have to think about what other parties need, other than ‘money,’ that motivates them to work. And that might just help you get your costs down.

 

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[Kak]

You are staying within the Amazon ecosystem only which is why this happens. Depending your entire business on the Amazon Algos. Sales platforms have commoditizing effects. Look at any top tier brand with quality, most aren't even on any 3rd party sales platform. Get off Amazon and market outside.

What came first the chicken or the egg? The answer: Who gives a shit?

 

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[MTEE1985]

Something that doesn’t cost a lot of money? An INSIDERS membership where multiple people have progress threads about raising outside money to scale their business or additional R&D.

Of course most great products take substantial capital to develop, what people are disagreeing with is your limiting belief that if you don’t have the cash in the bank then you are out of luck. It’s the “takes money to make money” line that is 100% false.

 

[MTEE1985]

This thread had no intention of adding value. Just discussion. Wanted to discuss before I tried again. I have had numerous products in the past.

Let’s try this a different way as you say you would like discussion contrary to your actions which say you want people to agree with you and you are determined to fight back if they don’t.

Yes, I agree with you. To create a high end physical product will often be capital intensive. However, that does not translate into the entrepreneur needing the capital at hand to accomplish this. Now, you will probably ask for examples.

Apple and Tesla come to mind. These companies I think most would agree provide a “top tier product” but they did not require the founder to provide capital.

Have you ever heard of Mike Markkula? 99.9% of people have not which is how he prefers it. I have as I had the privilege to get to know him. He was the #3 Apple employee and the initial financial backer. He met with Jobs and decided to provide funding of $250,000 for 1/3 of Apple at the time. Needless to say it was a good bet.

Another person you should look up is Chris Sacca. Early investor in Uber, Twitter etc. He specifies that his biggest bets are on the founder and not the product itself. If the VC firms truly believe in the founder they will invest.

Now on to you and the better questions you should be asking this forum: Do you have a physical product that you want to create/bring to market but are concerned about a lack of capital? Because if that is the case then there are no less than 3 people I will tag in this thread that either have gone through this or are going through the process currently and they will be happy to offer advice.

Before you continue on disagreeing with everybody I’ll leave you with this quote by Aristotle: “It is the mark of an educated mind to be able to entertain a thought without accepting it”

Agree with us or don’t, but for Gods sake, try not to be so closed minded.

 

[B. Cole]

I’m bringing a product to market with no outside capital, just my weekly paycheck.

You don’t need money. You need to work. Money just makes you start some shit you don’t understand, and weakens your commitment to it because you didn’t struggle through the inception. 99% of startups, if given enough capital to build an idea to a finished, sellable state, would blow it because they aren’t entrenched enough to know what the product actually needs.

Grow it from a seed, you’ll understand it way better than if you bought it as a full grown tree.

 

[NMdad]

OK, gotta say I actually LIKE this thread, because it demonstrates the mindset that any entrepreneur needs to have: instead of excuses, figure the sh*t out--there's always a way.

If someone held a gun to your head & you had to figure out how to solve your business problem, wouldn't you figure it out? Or would you complain that the gunmetal is too cold, could they maybe warm it up a little before they pressed it to your temple?

 

[Longinus]

What type of leather? Full Grain at least? English Bridle? Look at Sedgwick leather.

Leather Belt Materials
1) High Quality Leather (English Bridle)
2) Stainless Steel or Brass Buckle
3) Attaching the buckle, either rivets or Stitching (Waxed Linen is good)
4) Edge Finish: Either Burnishing or Edge Paint
5) Labels/Packaging

Tools
1) Leather Round Hole Punches (C.S. Osborne)
2) Belt End Punch (C.S. Osborne)
3) Edge Paint Roller
4) Leather Maul/Hammer
5) Healing Cutting Mat
6) Rotary Cutter
7) Skiver - thins out leather at bend
9) Pricking Iron - to make holes for leather thread
10) Leather Needles
11) Fileteuse (if edge painting) and for edge creasing
12) Leather Strap Cutter
13) Brass Logo Stamp
14) Brass Number Stamp Sizing
15) Heat Gun - to warm up Brass stamp
16) Leather Hole Template
17) Arbor Press
18) Stitching Pony

When using high quality leather, cheap tools are unable to even cut high quality leather. A better way for consistency is a clicker die press with a custom die made.

THINGS I'VE DONE TODAY:
- Researching and listing all the tools I can't afford for the business I won't start.
- Watching list and feeling sad about how unfair everything is.
- Finding other examples of companies I can't start because no money to prove my point.

 

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[DeletedUser0287]

What I have noticed about the best physical products, is simple. It is mainly just a money pump. Physical products quality is solely limited, by how much money a person has. My unpopular opinion.

Example: I am building a watch brand. I want to build the best offering for customers.

The crystal of a watch can be made of different materials. I will just go over two materials to demonstrate the point. Mineral and Sapphire. Just a basic search, and sapphire is clearly superior. With that in mind, sapphire is more expensive.

When there is a bad product on the market, it is just because the entrepreneur didn't have enough money to build a solid offering. I can have the intention to develop the best product, but the follow through is by having capital. I am just speaking about the product building step. No way around it. Normally, these products have to be built in house as well.

This is probably why you see businesses that max out of product development, but then have no cash to do marketing. Or the other type of business where they max marketing and have a poor product. Most people don't have money to max both. If you do max both, you are most likely a powerhouse/monopoly in your industry.

 

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[Ronak]

I've always been surprised at the low actual cost of using superior material/more labor. There have been many occasions where suppliers have said to me, "Oh, but that will cost a lot", but actually ends up being pennies in the grand scheme of things. I find you can charge a premium much higher than your cost if you offer a quality product. Too many products made by large companies are run by bean counters who only care about shaving 2 cents off production cost-- use that to your advantage.

Now with crowdfunding platforms and niche forums, you can kill two birds with one stone and get marketing exposure as well as cash from preorders without committing too much cash upfront.

 

[Longinus]

Or your product selection is just terrible because you want to sell something cool and shiny. But the truth is, nobody is waiting for another high-end watch brand, sorry. You might be wasting a lot of $.

There's so much choice and space to improve uncool and cheaper products. Last year I launched a new "invention" on Amazon. Cost me 35 cents more to manufacture than the original product (which cost me $4.30) and I sell it with better margins. A Chinese seller is even copycatting my idea now and selling at 50% of my price, but I'm still dominating.

 

[maverick]

What I have noticed about the best physical products, is simple. It is mainly just a money pump. Physical products quality is solely limited, by how much money a person has. My unpopular opinion.

Example: I am building a watch brand. I want to build the best offering for customers.

The crystal of a watch can be made of different materials. I will just go over two materials to demonstrate the point. Mineral and Sapphire. Just a basic search, and sapphire is clearly superior. With that in mind, sapphire is more expensive.

When there is a bad product on the market, it is just because the entrepreneur didn't have enough money to build a solid offering. I can have the intention to develop the best product, but the follow through is by having capital. I am just speaking about the product building step. No way around it. Normally, these products have to be built in house as well.

This is probably why you see businesses that max out of product development, but then have no cash to do marketing. Or the other type of business where they max marketing and have a poor product. Most people don't have money to max both. If you do max both, you are most likely a powerhouse/monopoly in your industry.

You're right. Give up.

 

[eliquid]

And this is why I push people to start businesses in areas they are an authority in.

I didn't say it was the only way, but it makes things so much simpler for the general lot of people. Especially those people new to business or those that have had several failed attempts.

BTW authority != smartest or best.

OP, what are you an authority in?

.

 

[rpeck90]

What you're talking about are barriers to entry. This is business 101 so won't go into it.

The point is that you're complicating things. Yes, top tier products typically cost a lot to produce (compared to their cheaper alternatives), but that's not entrepreneurship.

Entrepreneurship is about making something out of nothing. Faster/Cheaper; Sexier; Easier; More Convenient; Catered to [women/babies/dogs/cats/Spanish-speakers]; Comes in all Colours. Quality generally isn't one (it's normally the realm of established businesses who already have marketshare -- the two examples posted in the thread already allude to this).

A "secret" is that entrepreneurs sell results. Employees sell time; entrepreneurs sell results. If you're worrying about the cost of the materials - are you really focused on results? Probably not.

From what I've read - and I'm not qualified to give "advice", so please consider this an observation - if you're asking questions like this, you haven't identified a "need" yet. To identify a need, get to work on getting paid. Find people who have cash in hand and need someone to do something... shovel snow, walk their dog, program a website, wipe their a$$... whatever.

Do this and stack paper until you find something that sticks out. Maybe your dog pooper scooper doesn't pick up the whole package. Maybe there's a better way to make a bag that you can put it into. Maybe you see women wearing shitty Ugg boots and think you can make a better alternative. Whatever it is - you use the paper you just stacked to get a shitty prototype sorted.

The prototype doesn't need to change the world, but does need to be of an acceptable quality. Sell the prototype as "version 1". If you can find people give you money for it, get a batch made. Put it on Amazon and call it some name + "version 2". At this point, you may start to look at quality. As mentioned, the quality side of things mainly comes in as a defense against the swarms of Chinese ripoffs and little dropship kids who "finally" want to start a real business, but is not a prerequisite unless you're going after someone else's marketshare... which is 99% not going to end well for you.

 

[Rabby]

Related to the keychain and souvenir discussion above. It's worth noting that the product is not the market. The same category of thing in a different market might be better appreciated, and there might be more room for quality.

At a souvenir shop, people buy cheap stuff to give to their 20 friends and family members who didn't go on the trip. The friends and family then put that cheap stuff in the house so that they don't have to explain to their friend why they threw away the memento. Nobody really wants it. Ok, maybe I'm generalizing, but the reality is souvenir shops are not set up to attract people who spend big on a single item. They're set up as cheap trinket shops with lots of variations on the theme of "this city's logo on a <thing>."

Now, take the same category of <thing> and sell it to someone else. Real example. We made logo coffee cups for a trade show. There is a "cheapest" coffee cup which is similar to the glossy white ones in souvenir shops. That is not the one we used. Not that we would pay $100 per cup or anything, but if the cheapest one is $1 per cup, we might pay $5 or $6 per cup. Why? Because instead of fulfilling an empty obligation to "bring me back something from Timbuktu Ok?", we were trying to show appreciation to customers and give them something interesting, useable, and something they will actually keep. And it worked.

Same thing with keychains. As a souvenir, maybe they max out at $2 retail. At a trade show, we might pay $2 or more for them in bulk (you can see why that's more money to the manufacturer or distributor right?) if keychains are capable of conveying our message. A Dodge dealer once gave me a very nice keychain. If we're giving them to our top 10 employees as thanks for their years of loyalty? Or to any employee who sticks with us for 10 years? I wonder how much we would pay for that keychain, if a keychain was what we used. More than $2. You could make them out of .999 silver, or gold, with real enameling. I mean, maybe... that's for someone who's selling keychains to find out

Point is, it depends on the market, and how they value the product. What are they using it for, what's its utility value?

 

[WinYourself]

The real question: Is there a need for another watch brand?
If there is a need, getting money for quality production is no problem.
To keep it practical, get the sales before you go into production...Kickstarter style or sell limited edition on social media to fans of the brand.

 

[Longinus]

I said above, the watch brand was just an example...Original product is your development or competitor’s retail price? I don’t like pluggin other brands. But I will give example. Look up Knipex, top of the line pliers. Also, check out Berkey Water Filters. Tell me these products don’t cost an arm and a leg to develop. This is the tier at what I am talking about. How does regular income pleb do this without sacrifice his entire life.

All your examples need a lot of development and production costs. My example doesn't, that was my point. But you don't want to understand and just want to crawl in your victimized mindset.

Just like you did here:
Agree or Disagree: Entrepreneurship is a privilege

Perhaps entrepreneurship just isn't for you.

Good luck.

 

[RazorCut]

This entire argument is nonsensical. I launched a VERY high quality hand crafted product on Amazon about 5 years ago. I did very well for a while. Then the Chinese items entered the market full force. It was impossible to compete with this high of quality. My costs were a little higher, but my item was way better. In photographs that is hard to differentiate. To the customers, you could get "more value" for less money with a competing product. Set them side by side and you would never buy the Chinese one.

The consumers are ABSOLUTELY moving to the lowest cost, sh*t quality end of the spectrum. Look up any item on amazon. The number #1 result will be within 10% of the lowest price for that item. The first second and third best selling wrist watch on amazon are under $15. They are ALL rated 4 stars or better. You need to go 7 items back to even get to $30. There isn't a watch on the first page under $100... Tell me again why TOP QUALITY is the paramount ingredient to a successful business?

Oh hell this is so on the money. And why I came out of the Amazon seller space. Yes there are people who are willing to pay for quality but we are drowned out by the masses who want cheap at pretty much any cost, especially as their dollar is worth less and less as time goes by.

Rep+++

 

[klix]

Really? Please show me examples then of something that has low product development and unit cost and is actually a top tier product in terms of quality.

Look at OXO brand of products. They've become a premium brand charging 3-10x more than others simply by replacing plastic with silicon and stainless steel with chrome enamled stainless steel. And a paying a designer like $10 more an hour to get someone who has some design sense.

 

[Rabby]

Good lord. I made stuff out of leather and sold it when I was a teenager. It's cheap, especially something like belts. What tools did you feel like you had to buy? All the tools I had were less than the cost of one hide. Plus, you can make tools if you have any business being in a shop. I made premium goods that people paid for, with a very low investment, both leather and steel, as a completely green teenager. Go watch videos of people making things in the 3rd world, or in the woods starting with nothing. I'm starting to think you're just trolling.

 

[Ronak]

None, I mean who would invest in another private label brand? An investor for a better toaster oven?

Your mind is made up already-- as others have pointed out, you have solidified your beliefs and won't accept anything contrary.

Read @Kung Fu Steve 's posts on GOLD! - Why only certain people "enjoy" the process? (Or is it something else?)

For the record, yes, I have raised capital for multiple private label products.


The question is, would you rather be right, or would you rather be rich?

 

[Rabby]

I would contribute something meaningful here, but I can't because I'm laughing too hard.

The OP needs a $2,000+ die press before he can start making leather belts, or whatever. That and custom dies... wonder what those cost. I guess you have your excuse not to make "high quality products."

If you want to make things, you'll find a way. If you want to whine about being locked out of the making-things market because you don't have machines that approximate skilled labor, you're always welcome to do that.

 

[MTEE1985]

Example: I am building a watch brand. I want to build the best offering for customers.

Oh a watch company? Yeah, give up, need cash in hand for that. Huh? MVMT watches crowdfunded to get their capital?! Ok, but it’ll go nowhere. Huh?? Movado bought them for $100 million 4 years after launch??

Well shit. What’s your next excuse?

It’s a shame that you have to come in here with your skpeticism and closed mind because had you started a thread about starting a watch company and asking advice about raising capital it could’ve been really informational.

 

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[Joey El]

...[T]he hard reality of economies which I found out.

Yeah thats Fastlane reality...
But.... some people have less time for detailed posts than others. If you look around a bit, the member you're trying to discuss with could be a massive asset in your corner & has even offered a service for this.
Good luck.

 

[klix]

What type of leather? Full Grain at least? English Bridle? Look at Sedgwick leather.

Leather Belt Materials
1) High Quality Leather (English Bridle)
2) Stainless Steel or Brass Buckle
3) Attaching the buckle, either rivets or Stitching (Waxed Linen is good)
4) Edge Finish: Either Burnishing or Edge Paint
5) Labels/Packaging

Tools
1) Leather Round Hole Punches (C.S. Osborne)
2) Belt End Punch (C.S. Osborne)
3) Edge Paint Roller
4) Leather Maul/Hammer
5) Healing Cutting Mat
6) Rotary Cutter
7) Skiver - thins out leather at bend
9) Pricking Iron - to make holes for leather thread
10) Leather Needles
11) Fileteuse (if edge painting) and for edge creasing
12) Leather Strap Cutter
13) Brass Logo Stamp
14) Brass Number Stamp Sizing
15) Heat Gun - to warm up Brass stamp
16) Leather Hole Template
17) Arbor Press
18) Stitching Pony

When using high quality leather, cheap tools are unable to even cut high quality leather. A better way for consistency is a clicker die press with a custom die made.

I think leather is a perfect example that shows your thread is wrong. You can get everything you need to make awesome premium leather products for $200-$300, excluding the cost of the hide. All that will be missing is skill - which leather working requires a good amount of for good results.

Even the megakits on amazon that will suppy everything you need you can get for $120 will not hold you back, it just makes the job harder for you. If you want to upgrade from those kits, just get some japanese pricking irons which cost $20-$40 each (though you have to pay a good amount for shipping.)

If you want to include the cost of the hide, you can go for exotic hides like ostrich or alligator or snake for pretty cheap, and of course you can just get a quarter hide, sell your product, then use the proceeds to buy more hide.

"When using high quality leather, cheap tools are unable to even cut high quality leather" Really buddy? get a razor blade for 25 cents, get a razor blade skiver for a couple dollars. I guarantee you it can cut anything, including shell cordovan. Here's a video of it being done with a $10 X-Acto knife

View: https://www.youtube.com/watch?v=_j9TAB66t8I