Ramit Pitch

 

Clients suck, customers rule.
Or why service based businesses aren't as lucrative as product based ones.

I think it was Tim Ferris who first pointed outto me the drawbacks of service based businesses.  http://entrepreneurs.about.com/od/interviews/a/timferriss_3.htm They're difficult to scale, they require constant management of clients and employees, and while you're technically your own boss it sure doesn't feel like it. 

Service based businesses are dependent on clients, and clients suck. Clients ask for their new wordmark to be based off Courier New because their wife thinks its "fun font". Or they request that the dominant color of their yoga website be red, ignoring the fact that red is the most agitating color in the spectrum. 

Much of your client interactions require hand holding, persuading, and cajoling.  If you ever seen the show Flipping Out on Bravo, you'll understand the perils of having clients. The shows star Jeff Lewis is constantly juggling clients, contractors and assistants. Very little of that work can be automated because each task has its own unique demands that require his critical eye. This makes for a hectic business, but great tv. 

Some may argue it's your job to educate hold the clients hand but I say feh to that. Your hours on this planet are limited. You shouldn't waste your time explaining why Courier New is ugly. 

Get better clients you say? Maybe, but even then you're still working on their project. They get the final say and your suggestions are often shot down or changed so much that they're unrecognizable.  As Ben Pieratt so eloquently writes, " 

States of approval and decisions-by-committee and constant compromises are third-party interruptions of an internal dialog that needs to come to its own conclusions. 

Your muse can only be treated as the secretary of a subcommittee for so long before she decides to pack up and look for employment elsewhere." 

http://pieratt.tumblr.com/post/977179815/in-praise-of-quitting-your-job



http://www.bravotv.com/flipping-out


Customers on the other hand, are great! They only interact with you if they like your product. Better yet, if they like it enough they'll tell their friends about it. 

Customers will tell you where your product can be improved, and unlike clients you can take or leave their advice. Hell, Apple never listens to any of it's customers and they doing fine. The point is you have the option to do it your own way and that is incredibly freeing. 

How do you get customers? You can create a physical product and sell it. I'm not talking about handmade stuff on etsy, those things may be charming but unless you're incredibly talented, its hard to make it scale.

The good news is if you have a good idea for a niche product, its easier than ever to get it made. Ten years ago it took a lot of capital to mass produce a product, but that's not as true as it used to be. As Kevin Kelly has stated (http://www.wired.com/magazine/2010/01/ff_newrevolution/), Atoms are the new bits. In other words, creating a product can now be easy as creating a website.

So you have something you want to make, how do you find a manufacturer? 

When I first decided to make water bottles, I got quotes from several people on alibaba.com. Several manufacturers said they could do the job, but when it came time to put up the cash, I felt it was too much money to trust to a stranger. Additionally, I once read somewhere that the Chinese have a culture of saying yes to things, even the request is out of reach of their capabilities. 

I needed a referral from someone who had already created a similar product. After a couple of research and emails, I found a guy who had his own gin company. I explained to him my plans and asked about his experience with manufacturers. We emailed back and forth to establish a rapport, and soon after he kindly introduced me to his current manufacturer via email (since this introduction came from him, it helped validate me in the eyes of the manufacturer ).

One of the most frustrating aspects of product development is the manufacturing process itself. Firstly it takes a long time. You have to create enineering drawings, make moulds, test protypes etc. For us the start to finish time was 18 months. And woah unto you poor entrepreneurs who decide to take advantage of a fad, only to find 18 months later that tastes have changed and noone is interested in your Budweiser frog paper weights.

Theres also friction in dealing with remote companies. Much of that 18 months was spent trying to get our caps right. Due to technical limitations the original shape our product designer came up with couldn't be produced so that set us back a while. Even the seemingly easy issue of matching the cap color to the bottle graphics ate up time (see below)




In the end it was all worth it. The bottles are in stores and people are responding favorably to the bottles and our mission to promote tap water. Many of our customers find out about the bottles from their friends .

Once we reach critical mass, we plan to push the charitable aspect of the business even further. 


 [Bottles Image Here]





Clients suck, customers rule. 

Mason Gentry is a designer turned entrepreneur, and founder of FacetFace.com, a reusable water bottle company.