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Do You Have the Right Product?

The Key to Your Company

It seems self-explanatory that your product is the most important part of your company. But it’s often a factor that’s ignored or forgotten when owners are looking to increase valuation and their overall business. This is the reason it’s the first pillar of the Exit Mindset. It doesn’t matter if you have an amazing infrastructure and have tailored the perfect conversation with the customer if you don’t have the perfect product to go with them.

It’s easy to look at your company and get complacent. You might think that your product is fine because it’s making you a profit, and then perhaps lose the drive to improve it. But when you decide you want to move on and sell your company, your buyer either offers a significantly lower price than what it should be worth or they aren’t even interested. 

That’s because buyers are often looking to the future and considering how much they can profit from their investment of absorbing your company. They’re asking themselves if this product can be improved upon or if it will have an increased value in up-and-coming markets. If there’s no promise of either of those, then why would they have any interest?

The Answer is Innovation

You should ask yourself, ‘How do you give your product future worth?’ Thankfully, there’s an extremely simple answer: innovation.

This doesn’t mean you have to discover a new element on the periodic table or invent an entirely new product. Innovation happens when a person sees a solution that no one else has seen before. Often this just means combining and/or modifying already existing products or services.

Uber is a perfect example of this because, at its core, it’s their combination of a taxi service and computer software that allows Uber to be on-demand. Even UberEats does this, but with food delivery instead of taxis. These companies weren’t created by re-inventing the wheel, just innovating.

Simplifying the Complicated

Obviously you want to innovate and improve your business. But when you look at your product, you often have no idea where to start. Well, here’s where Rem’s Exit Mindset comes in. A new mindset will yield new results. He’s broken down the methodology of improving your product through innovation into three easy steps.

  • Define your product. 
  • Use your Exit Mindset to examine its potential. 
  • Make the changes.

What is your product?

This is another concept that’s trickier than it appears, but it’s essential. Over the years, Rem has spoken to hundreds of business owners who had the perfect practices for their company but were frustrated because it wasn’t working the way they expected it to. The most common problem was that they didn’t understand exactly what their product was, and thus weren’t selling it efficiently.

Your product can be many things, but all products fit into one of three categories; a physical product, a service, or a hybrid. The first two are a lot easier to define, but when it comes to hybrids, it can be complicated to figure out that your product actually fits that definition.

To illustrate the hybrid classification of your product, Rem gives Amazon as an example. It’s easy to assume that Amazon’s product is a physical one. Physical products are what you buy from Amazon, right? But when you think about it, you realize that Amazon doesn’t create the physical items; other companies do. You can find versions of most of their stock in a department store. They’re also not a delivery service, because the items are delivered to you most often through USPS or other companies. The reason you go to Amazon is they allow you to search through thousands of products, read reviews, examine the data, and decide what you want to buy. That’s their product; a combination of computer software and a service model.

So it most likely will take some deep diving, but once you understand exactly what your product is, then you can move forward and improve it.

Product Innovation

Now that you know what your product is, it’s time to consider how it can be improved. You can start with something extremely simple, and with just a little innovation, expand it into an incredibly profitable concept. That’s why research and development isn’t just a concept for Fortune 500 companies. R&D can just mean scratching a curiosity itch. Or it can lead to something exceptional.

A perfect example of this is how Netflix toppled Blockbuster. Netflix started out when the creator of Netflix, Reed Hastings, sent his friend a CD through the mail because his wife was tired of all the late fees they had to pay at Blockbuster. He just wanted to see if it would work. That was the tipping point. Then Netflix moved to digital media, and then onto making exclusive content. All of that allowed Netflix to become one of the most successful media companies in the world, and they’re still moving forward!

All it takes is looking at your product and finding where you can move forward with it. You don’t have to do it alone, either. Talk to your employees, your vendors, and even your customers. Look for holes in your market or in the environment around you, and think about how your product can fill them. Thinking, reflecting, and analyzing is difficult, but it will be what sets you apart from others. 

People often would rather move buildings than think too hard about a problem, but that’s where you as a business person differ from everyone else. You see what other people don’t, and that’s why you’re moving on a path to success.

Make the Change

After that comes the hardest but most important part – making changes. If you don’t put in the effort to implement the changes, your company will remain stagnant and eventually be lost in the momentum of everyone else moving forward without you. You don’t want that. You don’t want to be forgotten.

Remember AltaVista? Probably not. Most people don’t. In the early days of the internet, it was one of the most popular search engines out there, getting over 80 million hits a day — an enormous number for the time! Then Google came along, expanded to index images and more, and then kept on going. The rest is history.

Don’t let your company be like Blockbuster or AltaVista. Don’t think average, or get complacent. Use the Exit Mindset, innovate, and become the type of company that topples Fortune 500s because you refused to settle for having a “good enough” product.

To do that, you need a plan. Look at the ways other companies have innovated in their markets, and find out how your own product can be improved. Create a model that you can build upon as the years go on, and stick with it. Look at the difference between Microsoft’s Suite versus Google’s office suite. Microsoft’s products are based on physical software, so Google came into the market with theirs as a digital subscription service. G Suite and Microsoft both have similar uses for their products (Excel vs Sheets), but they both are innovating in their own ways, and thus can properly compete and not be swept away by the other’s progress.

New Mindset = New Results

Once you use the Exit Mindset and have this innovative model for your company, buyers will absolutely want a taste of it because they’ll see all of the work you put into it, and how it can expand even further in the future. But remember that it will be increasing your profit and work-life balance exponentially, so when it finally comes to selling your business, you very well might change your mind.

Either way, you’ll be getting your money’s worth, and enjoying the freedom that comes with having a successful company. So set aside some time to examine your product today. Does it look like it could use some innovation?

Listen to Our Podcast

In the third episode of the Exit Mindset, we join Rem Oculee, the Founder and CEO of Confidence Wealth Management, as he explains why your product is the most significant part of your company, and why innovating it is the key to increasing your business valuation.

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