Bicycle Built For You?
Succeeding In The Market
Although not all inventors can succeed in the bicycle products
category, certain attributes make this market stand out from others
in terms of accessibility. As mentioned earlier, consumers can see
the unique advantages of a bicycling invention. Compare that with a
product such as a drip coffee maker, where buyers can't
actually see the unique innovation hidden inside, such as a new and
improved brewing system. Bikes don't have any such hidden
parts. In addition, most bike riders actually understand what each
part does. This aspect of the bike business means that every bike
shop employee, sport-savvy consumer, bike enthusiast, racer and
bicycle magazine writer can immediately distinguish which products
are new and different—helping inventors get their products
noticed and evaluated. Lai, Winefordner and Koski all agree that the easy accessibility
and visibility of product features is a key reason so many
inventors are able to get new bike products on the market. "I
tell bike manufacturers that consumers will notice that their
products are different if they buy my components," says Koski.
"It's one way bike manufacturers can differentiate their
products." But in order for consumers to be able to purchase your product,
you need to find a distributor who can take it to retailers
worldwide. According to Winefordner, there are more than 100 bike
distributors. "Bike distributors will pick your product up if
you get good reviews in bike magazines and create product awareness
at trade shows or through an advertising program," he says.
Bike distributors typically carry around a big catalog of items,
and they're always open to competitively priced and innovative
products from inventors. Content Continues Below
The catch? Distributors require an extra layer of markups, which
usually means the manufacturer will only get 33 to 35 percent of
the final suggested retail price. "The distributor typically
takes a 28 to 35 percent margin, then the stores mark the product
up 100 percent," says Winefordner. So if the store pays $10 on
a $20 product, the distributor will make $2.80 to $3.50. Once you find success with your bike product, expect
manufacturers to come knocking on your door before long. Most of
them are anxious to buy out potential competitors, and most bike
inventors are more than happy to either sell their ideas or set up
licensing agreements rather than try to run their own
businesses. The difficulty level of introducing a new product varies
tremendously by industry and market. Inventors will have more
success in those markets where favorable conditions
exist—such as the bicycle product category. If you've
created several different products, study the market conditions and
choose the market best suited to inventors. You'll still need a
great product to succeed, but if the choice exists between two
markets—one easy and one hard—why not take the road of
least resistance? | | | | |  | | |  Going
Off-Road
Back in 1985, Erik Koski's family owned Cove, a bike shop in
Tiburon, California. In those days, shops put together mountain
bikes out of whatever components they could pick up. Perhaps not
surprisingly, that early exposure inspired Koski, now 48, to become
a full-time inventor. His first invention was the DuraTrac, a rigid
fork for front tires that he sold prior to the introduction of
front suspension. Koski advertises in catalogs and sells the
products through OEM (original equipment manufacturer) agreements,
meaning manufacturers use his components on their new bikes. Koski then worked for several bike manufacturers before deciding
to form Koski Engineering, a Mill Valley, California-based mountain
bike components designer, in 1994. His business strategy is still
to provide bike manufacturers with components that differentiate
their bikes from the competition. To date, he's developed
products that improve handlebars, handlebar stems and saddle seats.
His next two goals: first, to have his products look and act
different from the components developed by other competitors,
including Shimano, a Japanese company that supplies most of the
components bike manufacturers use. And second, he'd like to
create products with better durability. Thanks in part to help from his own OEM sales force, Koski
estimates his 2001 sales will exceed $3 million. Being serial inventors has certainly paid off for these
"brothers" in business: Sales last year neared $1
million. Winefordner credits that success in part to his strong
team of distributors: "Distributors are an ideal solution for
small companies that can't afford their own sales
representatives." | | |  | | | | | | | |
Don Debelak is a new-business marketing consultant and the
author of Bringing Your Product to Market(John Wiley
& Sons). Send him your invention questions at dondebelak@qwest.com. Contact Sources
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