Planning for product development
Let’s learn about Planning for product development. Product planning is the process of creating a product idea and following through on it until the product is introduced to the market. Additionally, a small company must have an exit strategy for its product in case the product does not sell.
- As an entrepreneur, your products are the most powerful statement of you, your company, and your business
- The key issue is that you need consumers to associate your products, company, and business with good quality and good value for money (so that they will buy again); therefore, it is essential that you understand how to develop great products from your ideas
- Successful product development requires the commitment of resources as an investment in future returns. Planning helps to identify what resources are needed and when so that even the smallest of enterprises can launch new products successfully to attract buyers while maintaining the core business
Product planning must also include managing the product through various stages of its product life cycle. These stages include the introduction, growth, maturity and decline stages. Sales are usually strong during the growth phase, while competition is low. However, continued success of the product will pique the interest of competitors, which will develop products of their own. The introduction of these competitive products may force a small company to lower its price. This low pricing strategy may help prevent the small company from losing market share. The company may also decide to better differentiate its product to keep its prices steady. For example, a small cell phone company may develop new, useful features on its cell phones that competitors do not have. Product life cycle can be viewed as an important source of investment decision for the company.
