‘Pioneers get scalped. Settlers get rich’. This expression personifies the concerns of business when ‘travelling the road less travelled’. Revolutionary ideas carry the promise of uncharted wealth, however the reality is more sobering. Recent studies have confirmed the problems of new product commercialisation, with newly launched products suffering from notoriously high failure rates, often reaching 50% or greater. So how can an Australian manufacturer retain a competitive advantage and lower risk? One way is to evolve existing products, using ‘real world’ end user feedback. The automotive market has used this model for decades to ensure they recoup the expense of initial R&D.
This model can be applied to existing products (big or small) to improve customer acceptance, with one of the latest techniques being Lean Manufacturing. Another successful approach is JIT (Just In Time) manufacturing. JIT helps companies retain lower stock levels, liberating cash flow and creates opportunities for range extensions and range evolutions. In recent times, many top Australian companies have exported their manufacturing, to reduce costs. This may be an effective way to lower the cost of a pair of jeans but it is not necessarily the smartest option with other manufacturing, where niche marketing is a more efficient way of lower risk and building market share.
JIT and Lean manufacturing are just two ways in which local manufacturers are helping clever Australian companies launch new products, evolve existing products and improve ROI. Before you pick up the phone and punch in that international dial code, ask yourself this question, ‘if my competitors are already established offshore manufacturers, what advantage is there for me to follow suit?’ Maybe the competitive advantage you’ve been looking for can be found in your own back yard.
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