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Get help, and assist others in with open source kits and running a business! Do not ask for legal advice or for consulting services in this forum, only general biz questions!

Thinking of starting out

by DannyQ on Tue Nov 20, 2012 9:23 am

I have a couple of projects that are prototyped and mostly coded and am thinking of offering as a kit.

Having read a lot of posts and blogs I'm not sure I'm any closer to working out where to start. For example, as they are SMD based, I could handle making a few each week and ship them out while being still being able to offer support. Now I'm not expecting virial sales but what options are if things scale up?

I'm sure if I have the sales, then another kit maker would take on the whole project and offer a percentage but I'm not sure how that really works, especially if you wanted to go down a different road on your next product. With the projects being Open, could I even get them to market before the competition if they turned out to be a popular idea?

There seem to be a few successful 'makers' that offer fulfillment services, are there benefits of this path rather than simply taking a royalty. Or do you just jump and have the kit put together elsewhere and just deal with the shipping?

I understand a lot of this will probably come down too how fast I can react etc but did you have a plan B and did it work?
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Re: Thinking of starting out

by i-make-robots on Tue Nov 20, 2012 12:54 pm

I get the feeling you've got doubts and maybe you're not sure what question you're trying to ask.
I read your post twice and I'm still not sure I understand what you want to know.
Can you try again, please?
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Re: Thinking of starting out

by lyndon on Tue Nov 20, 2012 3:26 pm

Here's my take on it.

If you have that problem, then it's a nice one to have. For every maker you see who's popular and selling kits so fast they can't keep up, there are probably another 100 that have never sold a single unit.

It's good to plan ahead, but don't psych yourself out: that's just planning to fail. Worst case, if your kit "goes viral" and you simply don't know how to keep up with orders, raise the price.
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Re: Thinking of starting out

by i-make-robots on Tue Nov 20, 2012 4:34 pm

+1 lyndon. Even if your kit goes viral, it will do so in a geometric curve. Your first 5 kits might be done by hand; your next 50 by bulk order; your next 500 manufactured in China. I've only just reached the bulk-order stage with my mural drawing robot.

Have you tried to get a friend to assemble your kit? That will tell you if your order process, assembly instructions, and after-purchase support have any flaws that need fixing.

Your kits should be making money from sale #1. Charge 2.2 times your cost of parts to account for labor and other "hidden" costs. As you grow and start to bulk-order your margins will only improve, which means you'll be able to afford help.
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