in Small Business
Issue No. 6 - July/September 2002
Are Your Products/Services Performing for You
by Alan Green
Getting your product or service mix right is one of the most important elements in ensuring the success of your business.
You must manage your products and services over time – as new technologies emerge, environmental conditions change and with seasonal fluctuations. This should be an ongoing process with new products and services being created to replace those becoming obsolete. Even at the point of market introduction, you should be thinking about line extensions and supplementary products/services.
Don’t think you escape the process if you only offer one product or service, as you too will have to make adjustments to your offering to capture technological improvements, changing tastes and preferences in the market place.
Where does each product or service sit?
How can you tell if your products and services are performing for you? You should start by preparing a matrix that looks at the performance of each product/service. Using a spreadsheet will allow you to see exactly where each item sits and you will also be able to track performance over time by up—dating the information every month or quarter.
You should include details such as profit margin, sales volume, market share and growth. It is crucial to know the performance of each item in your range so that you can determine which products to drop and which to add.
Most importantly, any product you contemplate adding should fit with your core business offering. If you are a website designer, electronic communications is your core business. So in addition to website design services, you might sell e—mail newsletter services to clients. These products must complement what you do and must be easy purchases for the customer to make.
You should be able to show your customer how they will benefit from purchasing the new product or service. It is here that you can use your business expertise to explain why this product is of such great value, quality or...
