The development of new products and services is the core of UK enterprise.
In fact, business growth and profitability depends on it. Considering it as an optional extra could be a costly mistake.
That said, some business owners see the development process as a risky undertaking. Well, you can reduce risk with considerable planning and a little bit of strategic organisation.
Your clients will be crucial if you are planning to develop new products and services. They give you an opportunity to test out any new developments before the rollout.
The purpose is to make sure that real demand for what you plan to sell, actually exists. So, you will be able to identify and fix any problems before wasting too much time, energy, and money.
5 Stages of New Product or Service Development
- The Idea: The first phase is all about generating and developing an idea. Talking to existing clients, as well as potential customers, will help you discover their needs.
- Research and Development: Whenever possible, develop a ‘cheap’ prototype. It can help you work out the least investment needed and confirms whether it will meet a genuine demand.
- The Testing Phase: Test the results with real customers to get lots of feedback. You also want to determine how much they would be willing to pay for it. Try different price ranges with many clients using a consistent, realistic process. Would the return on investment cover the cost of developing new product and services?
- The Analysis: There may be other businesses competing for the same market. If so, what makes yours different, is yours better, and how is different (or better) to what you already offer?
- The Rollout: It is the final phase in new product and service development. Rolling out anything new to the market is never certain. Even so, small businesses rarely prosper through word of mouth alone. You will need to promote the product or service using a variety of advertising and marketing campaigns.
Benefits of New Development
There are varying strategies for developing new products and services. But, in most cases the benefits of development give you an opportunity to:
- Enlarge or vary the field of operation or products that you offer. Doing so means the firm becomes less reliant on certain customers, trends, or markets.
- Spread out fixed costs over a range of different products (e.g. machinery and premises).
- Sell more and increase sales to existing customers. Enhancing existing relationships is much cheaper than finding new customers.
Importing goods from overseas to sell in the United Kingdom is another strategy used to expand a product range. But, there are rules on commodity codes and taxation to consider if you are starting to import into the UK.
Business Ideas and Intellectual Property
You might invent something new or develop an original idea that you want to turn into a product or service. As a rule, you should get it registered to stop others copying it without your permission.
Alternative sections cover the rules and regulations on copyright, patents, intellectual property and your work, as well as trade marks. Other organisations offer different sources of advice and support, such as:
- The business resource section at the Design Council.
- The ‘National Enterprise Network’ website (for local support on developing business ideas in England).
- The Business and Intellectual Property Centre of the British Library.
Note: You can improve the competitiveness and productivity of your business through funded partnerships with academics and researchers through Knowledge Transfer Partnerships.
ALSO IN THIS SECTION
Improving Products and Services | Start by focusing on existing clients and what needs they have.
Hiring and Training Staff | You need more capacity and a wider range of skills as the business grows.