New Product Development
Product Development
Realisation
Policy Formulation
Formulating
Goals & Strategies
USE
Strict Development
Product
Policy
Generating and
Selecting
Ideas
Idea Finding
New
Business
Idea
Product Planning
Dr A. Riza Wahono :
Market
Assesment
Marketing
Plan
Product
Designing
Product
Design
Distribution
& Sales
Production
Production
Development
Product Development
Production
Plan
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VISION/Mission TO BE SET
What vision do your company have have
- Time scale
- Scale of entreprise
- Turnover of entreprise
- Number of employee
What mission would your entreprise carry
- National
- Technology
- Environment
- Human development, etc
Does it achieveable ?
Preparing the first move
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Product Development
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Product Development
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Your Company & Business Ideas
answers these questions:
* Who are you/your company?
* What do your company want?
* What will it be like?
* Why will your company succeed?
* Why will your compnay fail?
* How big is a business?
IDEAS looks at two ways to select a business idea:
* What are your company skills?
* Which is the best market?
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Product Development
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Your Company & Business Ideas
YOUR COMPANY
The greatest determinant of the success of your
business is SELF ANALYSIS :
• your company,
• your company character and
• skills.
This you must believe if your business is to have any
chance of prospering.
Do not blames external factor for failure and
underestimate for your decisions impact.
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Product Development
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Your Company & Business Ideas
• WHO ARE YOU/your company?
The indications that can be reached are :
– not all business have the necessary ingredients
for success,
– there may be many company who possess the
vital skills and characteristics in full, but fail to
take advantage of them.
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Product Development
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Your Company & Business Ideas
• WHAT DO YOUR COMPANY WANT?
– An important part of your self-analysis should
include what it is your company hope to achieve
– Note what your company objectives are.
– Part of your self-analysis should be to see how
good or how bad a match your company
objectives are to the reality
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
WHAT WILL IT BE LIKE?
– Most probably the answer is much worse than
you can imagine. One of the more dispiriting
aspects is that while you may expect hard work
for one or two years, it could continue for
several. Taking advice, such as counselling, and
training are both likely to improve your chance
of success.
– If your company manage to survive, life will not
always be easy.
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Product Development
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Your Company & Business Ideas
• WHY WILL YOUR COMPANY SUCCEED.
To be successful if it fulfils three criteria:
1. the people involved realistically assess their
strengths and weaknesses and try to overcome
shortcomings. This is the most important
criterion.
2. the idea and the market for it has the
necessary growth potential and you have
experience in that market
3. financing is sufficient to cover the shortfall of
working capital, especially in the early days.
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Product Development
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Your Company & Business Ideas
If you cannot fulfil these criteria at the moment, do not
accept defeat; you may be able to in the future.
You should already have some self-knowledge about your
strengths and weaknesses as an owner-manager.
'Are you sure?, checklist can be used as a quick test of
where you stand.
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Product Development
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Your Company & Business Ideas
• WHY WILL YOUR COMPANY FAIL?
– Your company will fail if your operation does not
match up well to the three criteria mentioned above.
– Many causes of failure are a result of lack of skills.
– You do not have to be an expert at everything; but you
do have to appreciate the importance of all these
aspects so that you can control your business
properly.
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
• HOW BIG A BUSINESS?
– One factor to consider at an early stage is
which track are you in. You may know, from the
assessment of your skills and character, that
the most you aspire to is being a business,
pottering along steadily or else
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Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
• Business Idea does not have to be novel, original or
revolutionary. Should not veer away. Being first is not
always best.
– To offer such a product has to educate a market and
possibly establish a distribution structure.
– Into a market can capitalise on all the effort and
investment made by their predecessors.
– The ideal product or service to choose as a basis for
your business is one which you can distinguish from
the competition by including some additional feature
or benefit which is not available in other products.
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Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
 Draw up a shortlist of two, three or four ideas
which you can define and research before
selecting the one to run with .
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Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
•
Choosing an idea. There are two possible ways:
 using an established skill, product or knowledge, and,
in general, this gives you the greatest chance of
success
 identifying a market which looks ripe for
development by your business and acquiring the
necessary technique and knowledge.
• Your business will not succeed
if you have the skill or product but not the market, and
vice versa.
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Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
• WHAT ARE YOUR COMPANY SKILLS?
 expertise. Your company expertise may be
acquired as a result of staff education or
training on the job.
 Skill which they have acquired in their spare
time as a hobby. The disadvantage with these is
that you have not acquired any of the business
knowledge needed to turn hobbies into a living.
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
WHICH IS THE BEST MARKET?
• Research some markets in which you believe there
are profitable opportunities. The ideal market to
base your business in is one which:
– is growing or is large
– is supplied by businesses which are not efficient or are
outdated
– has a niche or sector which you can exploit
– is not heavily dependent on price to help consumers
select one product rather than another
– is not already supplied by products which are heavily
branded, that is, there is not considerable customer
loyalty to products from one or more businesses
– is not dominated by two or three very large suppliers, but
instead has number of smaller would-be competitors.
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
Do not be afraid of competitors; they prove that
there is business there to get.
If you need to raise money, the decision-makers will
want to see some, if not considerable, knowledge
and experience in that market.
If you do not have it, you have to concentrate
instead on demonstrating your all-round business
skills and experience, the strength offered by your
character and abilities, and the research you have
undertaken into your chosen market.
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Product Development
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Your Company & Business Ideas
• NO IDEAS AT ALL?
Try organizing what is called a brainstorming
session.
Spend a couple of minutes outlining the sort of
idea you are after and what you have already
considered but dismissed and why.
Ask for other people reactions and hope that
some ideas will emerge.
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Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
• DEFINING YOUR BUSINESS IDEAS
Draw up a short list of two or more ideas.
– Draw up a pen portrait of each idea.
– Carry out research before encapsulating your
final choice in a detailed business plan with
realistic forecasts. definitions of a couple of
the most promising ideas, you will find that
during the detailed estimation and calculation
stage, one idea will emerge as the favourite.
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
BUSINESS IDEAS
The brief sketch should define the following points:









a description of the product or service
an indication of why it will sell
a description of the intended market
an indication of whether your idea is for the local market
only or is applicable to the international market
your estimate of the approximate price
how you think it will be sold, for example, through shops,
salespeople, distributors
a first stab at the amount of sales you can make
how it will be made, if it is a product
its approximate cost.
Dr A. Riza Wahono :
Product Development
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Your Company & Business Ideas
SUMMARY
1. An unusual aspect of starting NEW business is that you make the
decision yourself that you have the necessary qualities and
abilities to make a success of it .
2. Analyse what you expect and hope to achieve from selfemployment.
3. Do not underestimate the problems and difficulties which emerge
for business
4. Use the checklists , 'Are you sure?' to identify your weaknesses
and strengths.
5. Try to take advantage of the many training courses and advice
agencies available to help improve those weaknesses
6. Do not be dissuaded from launching a business because you do not
have an original idea. With the right management and a promising
marketplace, a well-worn idea can be successful.
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Product Development
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Your Company & Business Ideas
SUMMARY (Cont’
7. The market can be crucial in determining success or failure (rated
second most important factor after management by providers of
finance). Carry out detailed market research 'Who will buy?’.
8 . Develop brief descriptions of a couple of ideas before researching
More thoroughly. Select the favourite and make up a detailed
business plan before setting up the business.
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Product Development
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Product Development
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MARKET :
•
•
•
You may know which market you want to enter; you may have got your eye
on a product which you think has potential.
Study your prospective marketplace in detail. Researching the
marketplace comes before raising money, making profit and cash flow
forecasts, finding premises or any of the other steps you have to take to
form your business.
– Knowing the number of customers
– you should be able to obtain information about what your potential
customer needs. This, in turn, should aid you to angle your product or
service to satisfy the greatest demand.
– To persuade people to purchase something they already want;
– educating a market to buy your product if the market has expressed
no great desire for it can be a long haul.
Show with confidence that you understand the structure of your market
and have a clear idea of where your product will be positioned compared
to the competition. You will obtain financial backing.
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Product Development
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MARKET :
R
E
S
E
A
R
C
H
Who
Why
How
Much
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Product Development
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MARKET :
Market research and how you can proceed to find
out about your particular market.
1. What it is you need to know about the market. Define the bit
(or segment) of the market you are specifically going for,
• WHO WILL BUY? (Who Will Be Your Costumers?)
• WHY WILL THEY BUY?
• HOW MUCH WILL THEY BUY?
2. How to carry out the research.
• HOW TO DO THE RESEARCH looks at the nitty-gritty of
carrying out the market research needed. How is it done?
What sources do you use? Are some more important than
others?
Dr A. Riza Wahono :
Product Development
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MARKET :
• WHO WILL BUY? (Who Will Be Your Costumers?)
which are your customers and what are their common
characteristics?
• WHY WILL THEY BUY? helps you form your sales
proposition to your target market. What are the main
features and benefits which your potential customers
are looking for? Can your product supply them? This
process helps you to define your service or product
specifically, and in relation to the competing products,
so that your product is differentiated from the runof-the-mill.
• HOW MUCH WILL THEY BUY? leads into how you can
utilize the information about market and potential
customers to make realistic sales forecasts
Dr A. Riza Wahono :
Product Development
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MARKET : ( Who Will Buy )
• Basically, you should be looking for a niche in your
proposed market (market segmentation) which allows
you to charge a reasonable price and so maintain
reasonable profit margins. To achieve this, your
product needs to be clearly distinguishable from the
competition (product differentiation).
• Once you have sorted out the groups, look at the
competitive position, you need to be able to offer
customers some additional benefit in your service or
product, and it must be a benefit they want.
• For a small firm, a strong attraction of using this
market segment approach to sales is that you may be
able to achieve a dominant position in that segment.
Dr A. Riza Wahono :
Product Development
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MARKET : ( Who Will Buy )
• If your business is on a smaller scale, it still makes
sense to look for a niche to exploit, because of the
advantages it offers in being able to keep your prices
above rock-bottom level.
• There are several different ways of grouping people.
These include looking at potential customers :
– by examining facts about their life, such as where
they live or the kind of work they do. Or
– how they behave when they are deciding to buy a
product, such as whether price makes a substantial
difference to their buying decision.
– Use the step-by-step analysis to help you sort out
groups or segments.
Dr A. Riza Wahono :
Product Development
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MARKET : ( Who Will Buy )
MARKET GROUPING
• Identify a group of people with similar tastes in your target
market does not necessarily mean that you have unlocked a
source of sales for your product.
• To be useful, a market grouping needs to have certain
characteristics.
– The segment needs to be big enough to give you the living you
require. You must also be able to differentiate it from other
groups, so that its size can be measured.
– The segment must be easy to reach. There is no point in
selecting a target group which is difficult to reach. If it is, you
will experience problems getting your message across or
supplying the product because of location.
– The group must have common features which actually lead to
similar buying decisions.
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Product Development
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MARKET : ( Who Will Buy )
Distribusi
Age
Sex
Marital
Status
Quality
Consumer
market
User
Price
Life style
Dr A. Riza Wahono :
Area
MARKET
Product
Development
Social
Class
GROUPING
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MARKET : ( Who Will Buy )
Professional/Industrial
Market
Type
Scale
Price
Delivery
After sale
MARKET GROUPING
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Product Development
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MARKET : ( Who Will Buy )
WHAT DO YOU KNOW ABOUT YOUR LIKELY
CUSTOMERS?
• Knowing a range of information about them to
understand your potential customers and sell to
them. If it is a business you are selling to, you
need to have information on the organization and
buying policies. Investigate the other suppliers to
your customers and acquire and analyse
information on the services and products bought
by them.
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Product Development
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MARKET : ( Why Will They Buy )
• find out what your customer wants.
• What are the benefits and features of a service
or product which your target group rates most
highly? (Research)
• have the framework of your customer needs,
• your sales package can be altered to achieve the
desired objective. These include:
* appearance
* delivery time
* maintenance
* performance
* quality
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Product Development
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MARKET : ( Why Will They Buy )
• By adjusting your service/product in this way to
meet the wants and needs of your target market,
you are trying to establish that you have at least
one unique feature which your competitors don't
have.
• It would be a mistake to believe that buyers act in
a rational way, comparing products and choosing
their purchase on the basis of some organized
assessment.
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Product Development
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MARKET : ( How Much Will They Buy )
• Estimate of how much you are going to sell and when
that is likely to happen. You need this data to
formulate your sales and cash forecasts.
The level of sales you can make over the years depends
on:
• the market size
• the market structure
• the market share you can establish (and the
competition you face)
• the market trends, that is, whether it is growing,
static or declining
• the investment in time and money to sell your
product.
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Product Development
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MARKET : ( How Much Will They Buy )
MARKET SIZE
• This could be either its monetary value or the number of
units sold in the market. Beyond this you need an estimate
of the market potential.,
• assess the size of the particular segment you are interested
in.
MARKET STRUCTURE
• This is the process by which the final product is sold to the
end-consumer.
• know how your particular market works to be able to
estimate the value of sales.
• Any study of market structure can only apply at the time the
study is made, because distribution networks are constantly
evolving,
Dr A. Riza Wahono :
Product Development
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MARKET : ( How Much Will They Buy )
MARKETSHARE
To be able to forecast your sales you need some idea of
– what share of the market your competitors have
– information about your competitors' business and
products to enable you to position and price your own
offering.
– there are some ways of influencing the share you can
seize.
• build a reputation for good, consistent quality.
• maintaining a reasonable level of marketing activity:
PR, advertising and sales activity.
• if your product is recognized as being ahead of the
competition in performance, design or whatever.
Dr A. Riza Wahono :
Product Development
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MARKET : ( How Much Will They Buy )
MARKET SHARE
Look at your competitors in a detailed fashion.
* what are the competitive products and how much do they
sell?
* how well have they done in the last few years?
* how is the company organized?
* how is their selling carried out?
* if they produce goods, how is it done and what are the
facilities?
* W ho are the main customers?
* what is the pricing policy and what sort of delivery is
offered?
Dr A. Riza Wahono :
Product Development
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MARKET : ( How Much Will They Buy )
MARKET TRENDS
• Market size, market structure and market shares do
not remain the same.
• anticipated changes in the economy can affect the
buying patterns of individual markets.
• New information or research may emerge on the
effect of certain items (for example, health hazards).
• look closely at your market to guess what changes will
occur which might affect the market trends if the
changes caused by government or local authority
policy.
Dr A. Riza Wahono :
Product Development
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MARKET : ( How To Do A Research)
The basic research methods include:
• desk research, studying directories and other
literature
• interviews with customers, suppliers, competitors,
distributors, ex-employees of competitors
• test trials.
Dr A. Riza Wahono :
Product Development
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MARKET : ( How To Do A Research)
Problem Formulation
Determine Research Design
Design Data Collection
Method & Forms
Design Sample & collect data
Analyse & Intrepret data
Research Report
Dr A. Riza Wahono :
Product Development
“ Pengembangan Bisnis ”
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WHICH IS THE BEST MARKET?
• Research some markets in which you believe there
are profitable opportunities. The ideal market to
base your business in is one which:
– is growing or is large
– is supplied by businesses which are not efficient or are
outdated
– has a niche or sector which you can exploit
– is not heavily dependent on price to help consumers
select one product rather than another
– is not already supplied by products which are heavily
branded, that is, there is not considerable customer
loyalty to products from one or more businesses
– is not dominated by two or three very large suppliers, but
instead has number of smaller would-be competitors.
Dr A. Riza Wahono :
Product Development
“ Pengembangan Bisnis ”
Modul 3
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Summary
1. Market research which is undirected is not very useful; it
needs to concentrate on who will buy, why will they buy and
how much will they buy.
2. It is much easier to sell a product which meets some already
perceived need rather than to try to educate a market to
buy a new, perhaps revolutionary, product or service.
3. Look for groups within your target market which you think
you can sell to, either because no one is currently selling to
them or because you can adapt your product to meet their
needs.
4. Use the step-by-step guide to help you identify a suitable
market group.
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Product Development
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Summary
5. Rational and emotional factors affect your target group's
willingness to
buy. Research these and alter your
product or sales approach to match.
6. Knowing how much customers will buy is crucial to your
business planning. You need to research market size, market
structure, market share, the competition and market trends.
7. Try to carry out your research in a systematic way so that it
can be properly analysed. Use desk research, interviews and
test trials, if possible.
Dr A. Riza Wahono :
Product Development
“ Pengembangan Bisnis ”
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SIMULATION
What
Who
Why
How
Much
Dr A. Riza Wahono :
Product Development
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