Pricing Your Product to Sell

But What if the Software's a Hit?

On the flip side, their biggest challenge is when they have a winner and must ship thousands of copies within 48 hours. Then, Cosmi's 150 employees shift into overdrive to fill the orders. (The company recently opened a division in Europe with 15 employees in the United Kingdom.)

If a retailer asks for a specific software program, Cosmi engineers can turn it around very quickly. For instance, after the September 11 terrorist attacks, a customer wanted a software program to help thwart identity theft. COSMI had it ready to ship in eight days. It would have taken a bigger company several years to do the work, Johnson says.

Comfortable with technology, Johnson began his career in the magnetic tape business and built one of the world's largest tape manufacturing facilities. Working closely with Radio Shack, his company eventually became the electronic chain's primary supplier of cassette tapes.

In the 1970s, magnetic tape was the memory device used in computers. Johnson says he began to learn more about the computer business. He had an offer to get involved in designing computer games but passed on it. But, by 1982, he knew personal computers would become a permanent part of life and believed software would someday become a commodity. (He still doesn't use a computer, but has two high-speed pencil sharpeners on his desk.) He also avoided being swept up by dot com mania, although the company does operate a Web site at www.cosmi.com.

When asked why he named the company Cosmi, he laughed. "Back in college, I took a marketing course that taught me if you want to create a name that is memorable, use five letters to spell something that mean nothing," said Johnson. "Think about Atari, Kodak and Exxon." Once he came up with the name, Johnson decided Cosmi stood for "Computer Operated Software Manufacturing International."

Here is some advice for entrepreneurs from Johnson: "Make a really solid business plan, and don't forget the profit and loss statement," he said. "Most failures are due to the fact that the guy who started the business just sees it from one angle."

Johnson also advises against having too many partners. He started Cosmi with 12 partners and ended up buying all of them out. "When Nintendo first came out, it devastated the PC business," said Johnson. "After five years of a rough transition, I went to all my partners and said, 'I'll pay you twice what you gave me.' So they went away."

Get a Business Makeover
Can you and your business benefit from a complete makeover? To celebrate National Small Business Week (May 5 to 12), one lucky business owner will receive lots of advice from a team of small-business experts, plus a package of prizes, including a Lexmark printer, a library of business books and tapes, and other business-related services. Best of all, the winner will travel with the makeover team from New York City to Washington, DC, on Amtrak's Acela high-speed train to meet Hector Barreto, chief of the SBA, and other small business leaders.

As part of the national Back on Track Americaeconomic revival campaign, sponsored in part by Entrepreneur, Amtrak will provide free transportation for the winner from the nearest Amtrak station to New York City. It's easy to enter this essay contest. Just explain in 500 words or less why your small business needs a makeover, including what kind of problems you need help solving. Send your essay with all your contact information to: Jane Applegate's Small Business Week Makeover, P.O. Box 768, Pelham, NY 10803. You can also fax entries to (914) 738-6339. The deadline for entries is March 31, 2002. More prizes and details will be announced in this column.


Jane Applegate is a syndicated columnist and the author of201 Great Ideas for Your Small Business. For a free copy of her "Business Owner's Check Up," send your name and address to Check Up, P.O. Box 768, Pelham NY 10803 or e-mail it to info@sbtv.com. Sarah Prior contributed to this report.

« Previous 1 Page 2
Loading the player ...

Tim Ferriss on Mastering Any Skill

Ads by Google

Share Your Thoughts

Most Shared Stories

1
Want Media Attention? Target Trades First
2
Don't Just Start a Business, Solve A Problem
3
6 Things Mark Cuban Says You Need to Be Great in Business
4
The 80/20 Rule and How to Supercharge Your Sales and Marketing
5
Is It That Important to Be Nice?