Developing a product and getting it out there to build a business is really hard. Whether it’s a single person acting alone to push their passion to the public, or a giant corporation with vast resources, everyone has to go through the same basic steps, and everyone needs to screw those steps up in the same way.
The reality is that the whole process needs to involve lots of aspects in order to succeed; small teams fail by not considering or dedicating resources to all of those aspects, and large teams fail by not having enough communication between the teams working on those pieces. But in truth, it’s a balance of many aspects that unlock a chance at a successful product. It’s worth recognizing this balance and seeking it out in your own product development efforts, whether you’re a one-engineer juggernaut or a large, established company.
Continue reading “Life On Contract: Product Development Lessons Big And Small”
Join us Wednesday at noon Pacific time for the Marketing and Selling Hardware Hack Chat with Shawn Hymel!
It may not be every hardware hacker’s dream, but a fair number of us harbor fantasies of thinking up the Next Big Thing and kissing the day job goodbye forever. It’s an understandable dream and a laudable goal, but as they say, a goal is a dream with a plan and a deadline. What’s your plan for turning your project into a marketable product? Chances are good you don’t have one, and if you ever expect to get to your goal you’re going to need one.
Shawn Hymel is an engineer who led several marketing campaigns for Spark Fun and recently shared his thoughts on marketing with attendees of the first-ever KiCon conference in Chicago. He’ll be dropping by the Hack Chat to talk about everything you ever wanted to know about marketing your hardware projects but were afraid to ask.
Our Hack Chats are live community events in the Hackaday.io Hack Chat group messaging. This week we’ll be sitting down on Wednesday, May 8 at noon Pacific time. If time zones have got you down, we have a handy time zone converter.
Click that speech bubble to the right, and you’ll be taken directly to the Hack Chat group on Hackaday.io. You don’t have to wait until Wednesday; join whenever you want and you can see what the community is talking about.
Eleven years ago, the Airbus A380 entered commercial service with Singapore Airlines. In the time since then it has become the queen of the skies. It’s a double-decker airliner, capable of flying 550 passengers eight thousand nautical miles. Some configurations of the A380 included private suites. Some had a shower. This is the epitome of luxury, a dream of flying with long-stemmed glasses, a movie, and a pleasant dream in mid-air.
Now, after the cancellation of A380 orders by Emirates, Airbus has announced it will end production of this massive, massive plane. No, it’s not the last flight of the Concorde, but it is the beginning of the end of an era. The biggest and most impressive planes just aren’t economical; it’s possible to fly three 787s across the globe for a single flight of an A380. The skies won’t fall silent, but soon the A380 will be no more.
Continue reading “Airbus To Halt Production Of The A380; Goodbye To An Engineering Triumph”
Here at Hackaday we are willing to bet that in a universe free of all monetary constraints, many of our readers would leave their day jobs in order to pursue their hardware hobbies full time. Obviously this is only practical for a lucky minority of people (for a wide variety of reasons) but we’re willing to bet that a significant stumbling block is figuring how to do it in the first place. You quit your job, but then what? If more information about starting and sustaining small hardware business’ was available more people would take the plunge to start one. There are software companies with salary transparency but this is only part of the picture and we can’t think of many hardware companies that offer the same. What we really want is to get an image of the entire business end to end; from suppliers to COGS to salary. And we want to see it for hardware.
Years ago the first and second Hackaday Prizes captured an entrant named FarmBot whose goal was to build open source robotic farming equipment to make it easier for anyone to grow their own food. A few successful Kickstarters and years later they’ve been shipped multiple versions of the Genesis and Genesis XL robotic farming system and have a sustainable business! And now they’ve decided to open source their business operations too. Suffice to say, this provides quite an uncommon view into the guts of what makes a small open source hardware business tick. Let’s take a closer look!
There is a wealth of information exposed in the company documentation; it’s as though they took their internal wiki and made it public, which we suppose is exactly what happened. The most interesting part for our readers might be the statistics page that tracks costs and quantities for their products. This is where the magic lives. You can use to it see that so far they’ve sold 124 Genesis XL machines at an average selling price of $3,834.34 for $475,458.30 of revenue (it cost $187,200 to build their run of 200 machines). You can also see that each machine has 1,415 parts and takes about 25 hours to assemble. This page is where the true guts of the business live.
Everything else is here too. Here’s where you can learn about what vendors FarmBot uses use logistics, or power, or web infrastructure monitoring. And this is the page with the infamous salary calculation formulas if you want to guess what you’d make as an employee. Then there’s a bunch of boring but important stuff. Fulfillment processes live here, and the consumables they use to support that fulfillment are listed here (with costs!).
One reason we enjoy open source so much is that it affords a wonderful opportunity for people to learn instead of keeping the important parts of a product or process perpetually under wraps. We’re hoping that documentation like this becomes more prevalent and foster an explosion of small hardware companies to follow it.
Just to be clear, the primary goal of the Papas Inventeurs (Inventor Dads) was to have the kids make something, have fun, and learn. In that light, they enjoyed a huge success. Four children designed, made, and sold laser-cut napkin rings from a booth at the Ottawa Maker Faire as a fun learning process (English translation, original link in French.) [pepelepoisson] documented the entire thing from beginning to end with plenty of photos. Things started at proof of concept, then design brainstorming, prototyping, manufacture, booth design, and finally sales. While adults were involved, every step was done by the kids themselves.
It all began when the kids were taken to a local fab lab at the École Polytechnique and made some laser-cut napkin holders from plywood for personal use. Later, they decided to design, manufacture, and sell them at the Ottawa Maker Faire. Money for the plywood came from piggy banks, 23 different designs made the cut, and a total of 103 rings were made. A display board and signs made from reclaimed materials rounded out the whole set.
In the end, about 20% of people who visited and showed interest made a purchase, and 60 of the 103 pieces were sold for a profit of $126. Of course, the whole process also involved about 100 hours of combined work between the kids and parents and use of a laser cutter, so it’s not exactly a recipe for easy wealth. But it was an incredibly enriching experience, at least figuratively, for everyone involved.
Possibly the biggest takeaway was the way manufacturing involved much more than just pressing “GO” on a laser cutter. Some pieces needed sanding after laser cutting, and each piece got two coats of varnish. If you missed it, [Bob Baddeley] showed how labor, and not materials, ends up being the most expensive part of a product.
“The prototype was $12 in parts, so I’ll sell it for $15.” That is your recipe for disaster, and why so many Kickstarter projects fail. The Bill of Materials (BOM) is just a subset of the Cost of Goods Sold (COGS), and if you aren’t selling your product for more than your COGS, you will lose money and go out of business.
We’ve all been there; we throw together a project using parts we have laying around, and in our writeup we list the major components and their price. We ignore all the little bits of wire and screws and hot glue and time, and we aren’t shipping it, so there’s no packaging to consider. Someone asks how much it cost, and you throw out a ballpark number. They say “hey, that’s pretty reasonable” and now you’re imagining making it in volume and selling it for slightly higher than your BOM. Stop right there. Here’s how pricing really works, and how to avoid sinking time into an untenable business.
Continue reading “Your BOM Is Not Your COGS”
You’ve no doubt been exposed to the ads for various inventor services; you have an idea, and they want to help you commercialize it and get the money you deserve. Whether it’s helping you file legal paperwork, defending your idea, developing it into a product, or selling it, there’s a company out there that wants to help. So which ones are legit, which ones are scams, and what do you really need to make your millions?
Continue reading “Inventor Services – Maybe Right For You – Maybe”