Checklist: the Important Tool for Entrepreneurs in New Poduct Development

This session is the final step of all the seven steps you must pass to establish your business in food processing. On the following pages (Table 1) is a checklist that may be useful for entrepreneurs in new product development. Understand that new product development is not an exact science. There are always different ways of doing things but this checklist covers some of what I consider the most important elements in the development and marketing of a new food product.

Use of these elements should increase your odds of success. As previously mentioned, new product development is not an exact science but also a discipline that requires some personality traits such as passion, persistence etc. Therefore, we cannot guarantee success by the use of our suggestions. You still have to provide the personality and perseverance.

Table 1. CHECKLIST FOR NEW PRODUCT DEVELOPMENT
STEP#	ITEM	COMMENT
1	Have an idea	1) Just do it. 2) Think of something to do. It doesn’t have to be great. You will probably change your mind many times before you get to one you feel really good about. 3) Remember that entrepreneurs find a need, want or desire and fill it. 4) Flavor concepts in themselves are not very good for the long haul.
2	Conduct a “Reality Check”	1) Talk to some people in your area that are doing something similar. 2) Conduct internet searches on the subject. Find out what has been going on in the area. 3) Determine if you can apply some new technology to the processing.” courses
3	Attend some “Small Business Development” courses in your region.	1) I highly recommend that you take the following courses 1) Starting a Business in your region, 2) How to Write a Business Plan and 3) Guerrilla Marketing. There are other ones that may also be of interest to you. 2) Review the booklet entitled “Business Blueprints; Is your Business Idea Feasible”.See if you have the personality and the abilities to start a small business. 3) Review the booklet entitled “New Venture Guide”.The information contained in this booklet will help you to determine state regulations, understand marketing and how to write a business plan. 4) I'm sure that there are many other resources available from the Small Business Development Center in your region. Use these resources as needed.
4	Start developing a business plan	1) Write down your idea and think about who will buy your product and why. What need does it fill?. 2) Start writing a business plan with emphasis on describing your product (the product, sales channel, trend, who is the end user, etc), Who is the competition?, What does the market look like?, What is your cost to produce?, etc. 3) The process of developing a business plan will increase your knowledge of the industry and your passion for the business will build. 4) Work on it several times per week. Think big. 5) Talk about your product to people in the industry. Go where food people hang out. Successful people have a habit of helping others. 6) Use available assistance 7) Learn the business 8) Spend 3-6 months in this phase of writing a business plan. Call it “minimal risk taking”. 9) Define your marketing strategy. This is very important. It is how you will “go to market”. What promotional tools will you use? Coupons, advertising mode (TV, newspaper,). How will people know about your product? Use guerrilla marketing. What is your pricing strategy? Develop sales information and “point of sale” material. Make a sales target list. Conduct market research. etc 10) Learn more about federal, state and local regulations, permits needed, type of business, etc
5	Decide on your packaging option	You need to decide how your product will be packaged. This may be dependent upon whether a copacker can package it the way you want.
6	Decide on a manufacturing mode	------
6A	Copacker Mode	CoPacker Mode; 1) Get confidentiality/ non- disclosure agreement signed 2) Give formula to copacker and discuss product 3) Get label and package designed. Get UPC code 4) Write process specification ( pack size, quality checks etc) 5) Get test batch made.
6B	Self Manufacturing	Self Manufacturing Mode; NOT RECOMMENDED 1) Acquire facility 2) Get inspection for facility for either "FDA" or "USDA". 3) Get equipment 4) Hire skilled people (sales, production, marketing, QA/QC, maintenance, finance etc) 5) Write process specifications, labeling, licenses, procurement of ingredients, packaging, etc, etc, etc.
7	Design package label	1) Decide how you want your label to look for maximum consumer appeal. 2) Make sure to include the 5 mandatory parts required by federal regulations and any other that may be needed. 3) Get UPC code if needed or desired. 4) Do a pricing on your product
8	Get Sales	1) Try to sell your product. Go everywhere. Doors will be slammed in your face. Live with it. 2) Continue to refine marketing strategy the rest of your life. 3) Sell to everyone, everywhere. Never stop. 4) Everyday, try to call on at least one possible customer.
9	Get more Sales	1) Refine marketing strategy 2) Continue selling 3) Remember – You are getting what you wanted. And you thought making money would allow you time for vacation? Ask Bill Gates about vacation. He took only 10 days over a 10 year period of time. "SUCCESS IS ALL ABOUT PASSION AND GOAL ACCOMPLISHMENT".

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Assistance: It will Accelerate Your Steps in Starting Food Processing Business

You need assistance

There is one thing that you should not forget to complete your steps in starting your food processing business. You need "Assistances". Some assistances you have to contact as soon as possible are listed below:

1. As an entrepreneur, you have many places to go for assistance. The federal and state governments want you to be successful so you can pay more taxes so they have institutions that provide assistance at no or minimum costs. 
2. For food product technical assistance, contact the Institute of Food Science and Engineering nearby your business located.
3. For business plan development, contact the Small Business Development Center in your country. 
4. Remember the old adage “Success breeds success” and successful people want to help others become successful. There are many people out there in the world who have been successful and would like to help others. They will help you in ways you would never imagine. Successful people are always helping others. Seek out these people, take them to lunch and most of them will tell you everything they know. They can provide you with a lot of important tips. The information age is upon us. 
5. The internet makes information readily available delivered to our home. There is a tremendous amount of information that is available for your use if you know where to find it.

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Going to Market: One Step Ahead to Start a Successful Food Processing Business

As I've presented before there are four first components in starting a food processing business you have to do and preparing well: the product, the business plan, manufacturing/operations/regulations, and label design and packaging. In this session I will present the fifth one: going to market.

Once you have all the above mentioned items completed, you are ready to “go to market”. In marketing management, the term “go to market” refers to the channels a company will use to connect with its customers/business and the organizational processes it develops (such as high tech product development) to guide customer interactions from initial contact through fulfillment.

A firm's “go to market” is the mechanism by which they propose to deliver their unique value proposition to their target market. That value proposition is based on the choices the business has made to focus on and invest in markets and solutions that they believe will respond positively to the increased attention.

Marketing strategy involves "Who" the firm will go after and "What" it will offer them. “go to market”  is a component of the overall marketing strategy and is concerned with "How" the firm will make it happen. “Go to market” is a strategy mainly used by marketers of goods that are not for the mass market. The main focus of this marketing exercise is to target the direct consumer or the one in authority who makes the buying decision.

For this step all you have to do is to get some samples made to take out and show buyers who represent stores or restaurants. Set up appointments with product buyers. Maybe hire a professional sales person to make the presentation. After you have the order, implement your business plan. You can never have enough customers. Continue to refine your business plan and make more sales calls. You can never have enough business.

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Label Design and Packaging: an important product components to consider when starting food processing business

Food product labeling and packaging
materials: many options

Food products must look good and in a package that consumers recognize. The label design and color can have a tremendous impact on how well a food product sells. I suggest that entrepreneurs find and utilize a graphic design company that understands visual literacy and how customers tend to shop with their eyes.

In today’s world with computer graphics, it is so easy to do it yourself but you may not understand the customer as well as you think. Remember to include the nutritional label, UPC code and a product code for tracking your product. Maybe you should consider having the name of the product or logo trademarked. 

Aside from the government requirements and the buyer’s requirements, there are things you must be cognizant of to effectively “romanticize your product” and to entice potential customers to pick up and try your product. When it comes to the actual package of the product, remember to package it in a form that the customer can identify with. For example, customers are used to buying bread in plastic bags so don’t package it in a can.

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Manufacturing, Operations and Regulations as Important Components When Starting Food Processing Business

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Co-packing is a comprehensive term
that covers multiple activities and
each co-packer has its own areas
of expertise

After you have a food product concept and have written a fairly extensive business plan, it is time to consider the manufacturing of the food product. It is highly recommended that an entrepreneur first use the co-packing option. Co-packing, also known as contract manufacturing, is when you go to an existing food processor and have them make the food product for you. 

Many food manufacturing facilities have excess capacity and these plants can offset some of their operating expenses by selling you that excess capacity. I recommend this option for several reasons:

1. It minimizes your financial risk
• A small processing plant can cost over $100,000 and building a processing facility to support an untested food concept is a financial risk you don’t need. 
• Your money and time is better spent selling and marketing the product. 
2. Government regulations are very long and hard to understand for the new person to the business
• There are many government regulations you must know about before getting into the business. 
• There are regulations governing the facilities, processing, labeling (to include 5 parts of all labels, nutritional labeling and allergen labeling), food safety plans and naming of the product (standards of identity).
• For an entrepreneur, this is just too much to handle when the success of new products lie in the sales and marketing of your product. There is just not much money to be made in manufacturing.

by: Harrys

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The Business Plan, One of Seven Components to Start a Successful Food Processing Business

After you have come up with an idea for a new food product or processing method, the next step is to develop a business plan. Sample business plan outlines are available on the internet and are discussed in a later article. The writing of a business plan is the most important part of the whole process of developing a new food product or process but often neglected and is probably why most new food products fail in the marketplace. 

The concept of developing a business plan is to write down your thoughts and review them frequently with ever increasing detail. I could see a person working on a business plan for 5-6 months. The idea is to plan your new business in every detail so that you minimize the probability of wasting money. 

Once you have started writing the plan, you will realize that there are areas that you don’t know about. Try to find people who can help you in areas that you are unfamiliar with. Get assistance wherever you can. There are a number of sections of a business plan that I do not think are initially important but there are others that tend to be the central focus of the whole new product development scheme. The most important aspect of the business plan is how you plan to market your new food product. You must clearly define such elements as “defining your customer” and why should a potential customer pick up your product versus a competition”. 

Other important elements include “how you plan to manufacture the product and distribute it” but these are not as important as getting potential customers to pick up your product and try it. I often hear people say that my product tastes real good. That is good but how will potential customers know that it tastes good unless they pick it up and try it. If you cannot market and sell your product, you do not have a viable business.

by: Harrys 

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The Product, One of Seven Components to Start a Successful Food Processing Business

Corned Beef, a beef based of
prosessed food product

The first step in starting a food processing business is to have a food product concept or idea. The concept or idea can be either a particular product or a new and innovative processing method. The idea or concept doesn’t have to be perfect to begin with. You just need to just get started on something. Your original idea or concept will probably change several times as you develop your business plan and get to know the business. So just start with any idea and move forward.

Potato Chips, one of possible options

Your idea could put more people to work and you may be the kind of person this country needs to compete in world markets and maintain its standard of living. Your idea may be the cutting edge of the future. In general, food products with just a different flavor do not have a high success rate because they can be easily matched by spice companies. Anyone can go into a store, buy your product and match the flavor within a matter of weeks. On the other hand, the restaurant trade is always looking for food products that they can just heat and serve. 

Canned Fish, a fish based of
prosessed food product

They may have an interest in a new food item. Just start with a concept or idea knowing it does not have to be the ultimate idea. Remember that ideas are “a dime a dozen”. This means that your idea for a new product is not the key to success. I agree you have to have a good idea but companies with good ideas fail all the time. You have to have knowledge of the business, certain skills necessary to run the business, have family support for the first 3-5 years to get your business off the ground. Perseverance and some luck are also needed. All of these things will have to flow forward over the first few years of your business.

by: Harrys 

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How to Start a Successful Business in Food Processing

Starting a successfull food processing business

This article will provide how to start a successful business in food processing. This article will generally overview of the field of starting a food business. The road to developing a successful new food product can be somewhat confusing and long. This guide can be used to make the journey easier to understand. This article goes through some of the key things one must do to start the journey and is written to help you understand the “big picture” of food processing business.

The details of the components of starting a food processing business in this article are discussed in subsequent articles in greater detail.

Shrimp Tempura:
one of processed food products

There are at least 7 (seven) components you should know well to start a successful a food processing business.  The seven components are listed below and it's detail will be discussed completely in the next coming articles.

1. The Product
2. The Business Plan
3. Manufacturing/Operations/Regulations
4. Label Design and Packaging
5. Going to Market
6. Assistance
7. Checklist for Entrepreneurs

by: Harrys 

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