You may or may not know that I’ve run a company for the past 8 years or so, and while our primary business has been related to web development and services, we’re looking at branching out a bit, driven by the fact that more and more I seem be getting requests to help build, or just straight out sell, a button.
There’s a page over on the Sparkbooth site about USB Button Keyboard Replacements that has a number of solutions, and mentions a few of my blog posts, so based on this, I’ll be building a bunch of buttons and putting them up for sale.
I don’t have a ton of experience selling physical products (though I did silk screen shirts and sell those years ago) but I’m going to be jumping into this, and we’ll see where it goes.
I’m not ready to become the next Adafruit Industries or Makerbot, but I’ll be writing up my experiences dabbling in the area of being a “Maker Business” and besides those two companies (which I admire) I’ll be looking at others, and hey look, this piece about Ten Rules for Maker Businesses has some advice for me, so I’ll be using it as a bit of a guide.
- Make a profit.
- It takes lots of cash to stay in stock.
- Buy smart.
- Basic business rules still apply.
- You get no leeway for being a maker.
- Be as open as you can.
- Create a community to support and enhance your products.
- Design for manufacturability.
- Marketing is your job.
- Your second most important relationship is with your package carrier.
OK, let’s get started! I won’t tackle all of these in this post, but we’ll start with #1: Make a profit.
Yeah! Money… it’s great! But seriously folks, I’m not in this to make a big pile of money, but I’m also not in this to lose money, or just break even. In my original post about the button I outlined all the parts used, and provided the code. My hope was that others who wanted to make one could, and some have, but there are a bunch people who either just want a final product that “just works” or want someone else to do the “hard work” of soldering and programming. I can handle that…
As for the actual pricing of the product, my initial estimate (before I even read the rule of 2.3x) was pretty darn close. Setting prices can be hard, but I’ve become a firm believer that charging too little is an idea that will do more bad than good in the long run. Yes, some people will think it’s overpriced, but they are more than welcome to buy another product or make their own. I’ve even provided all the info needed for people to make their own. (Yeah, you could mention something about open source hardware here if you’d like.)
So in this whole “experiment” I’ll keep in mind that I need to make a profit. I’ve got no plans to get rich from this endeavor, but if I’m lucky, I’ll provide people with something they want at a reasonable price.
This should be interesting…
(See all the posts in this series: Begin, Stock, Buy Smart, Basic Rules, No Leeway, Be Open, Community, Manufacturability, Marketing, Shipping, Lessons Learned, The Real Costs.)
2 replies on “Maker Business – Begin”
So what is this rule of 2.3x that you speak of?
Eric, if you follow the link for “Ten Rules for Maker Businesses” you can see the part that says “You should price your product at at least 2.3 times its cost…”
If you charge exactly what it costs, and don’t factor in your own time, price fluctuations, support, shipping, etc. then you’re on your way to losing money.