Re:Want to improve your odds? Think hardware
by HeyLaughingBoy on Wednesday July 08, 2009 @12:41PM
(#694178)
Ugh!
I can't imagine a worse market for a small starup than consumer electronics. Margins are tiny, getting distribution is insanely hard and you need incredible amounts of cash to start up. And if your product is popular, it's a matter of weeks before the guy overseas building it for you copies your design and sells it himself for 1/5 the price.
Far better to find a small industrial niche and enter it with a simple product the "big guys" won't bother with. You can sell directly to your users, your margins can be much greater, with smaller volumes you can literally build the hardware in your basement and your investment is minimal.
My sales are low (less than $10,000 last year), but by targetting industry, I get >$100 for essentially the same product that is marketed to hobbyists for $20.
I can't imagine a worse market for a small starup than consumer electronics. Margins are tiny, getting distribution is insanely hard and you need incredible amounts of cash to start up. And if your product is popular, it's a matter of weeks before the guy overseas building it for you copies your design and sells it himself for 1/5 the price.
Far better to find a small industrial niche and enter it with a simple product the "big guys" won't bother with. You can sell directly to your users, your margins can be much greater, with smaller volumes you can literally build the hardware in your basement and your investment is minimal.
My sales are low (less than $10,000 last year), but by targetting industry, I get >$100 for essentially the same product that is marketed to hobbyists for $20.