D. MARKETING A SMALL BUSINESS 7.00 Identify product decisions necessary for a small business Explain products/services that make up the product mix. (The logos used in this PowerPoint were copied directly from corporate websites. They have not been altered in any way.)

Terms related to product/service planning Product/service planning: Process of developing the product/service mix for a business by incorporating decisions relating to market opportunities. Product mix: All the products a business makes or sells. Goods: Tangible, physical products that satisfy a want or need. Services: Intangible or conceptual products produced to satisfy a want or need; tasks performed for the customer for a fee.

Product/Service Considerations New product/idea development: Development of products/ideas that have not been offered on the market or which modify what is presently on the market. Steps – Generate ideas Screen ideas Make prototype and develop business proposal Develop new product Test market the product Introduce product

Product/Service Considerations Product selection: Choosing products for the business that meet needs or wants for the area and target market. -- Monitoring existing products --Eliminating weak products

Manufacturers Wholesalers Tradeshows SUPPLIERS

Classifications of products/services

Consumer products: Goods used by consumers for personal, family, or household purposes.

Consumer services: Activities purchased by a consumer for personal or family purposes.

Convenience goods: Inexpensive products that require little time and effort on the purchase decisions and are purchased regularly. Staple goods Impulse goods Emergency goods

Shopping goods: Products that usually require a great deal of time and effort for the purchase decision. Consumers search and compare similar products prior to purchase.

Specialty goods: Sought by a consumer who desires a specific brand or product.

Pure services : Activities performed that do not include a tangible product. Non-good services: Personal/professional service for a fee. Owned-good services: Activities that alter, improve, or repair products already owned. Rented-good services: Provide a product to use for a brief period for a fee.

Product related services: Activities offered with or to compliment a product.

Industrial goods: Goods purchased by a business to produce other goods or to resell to consumers.

Industrial services: Activities used by a business to insure proper operation, or contracted by a business to perform a task.

Installation and accessory equipment: Part of the production process used to MAKE products. Raw materials, components, fabricated parts: CONSUMED to produce a product or become part of the final product.

Industrial supplies: SUPPORT or FACILITATE the use of industrial goods of the operation of the business. Maintenance and repair: Cleaning, repairing, painting, or decorating that is performed for or by a business.

Business advisory: Management consulting, legal, engineering, or accounting performed for or by a business.

Elements of the product mix Product line: A group of closely related products manufactured and/or sold by a business.

Elements of the product mix Product item: A specific model, brand or size of product within a product line.

Elements of the product mix Product length or depth : The number of product items offered within a product line; an assortment of sizes, colors, and models. Deep mix: Many items offered in the same line; meets many needs. Shallow mix: Few items offered in the same line; specializes in meeting certain needs.

Elements of the product mix Product width or breadth : The number of different product lines a business manufactures or sells. Narrow mix: Limited number of product lines; focuses on a specific target market. Broad mix: Many different product lines offered; focuses on one-stop shopping to meet many needs and wants.

Elements of the product mix Product consistency : The relationship of a business’s product line offerings in terms of use, price range, target market, and methods of distribution and production.

Importance of Product/Service Planning and Mix Competition - “”Beating” the competition; increasing the market share.  Direct competition – Same product is offered by like competitors.  Indirect competition – Competitors offer similar or substitute products.

Importance of Product/service Planning Mix Changes in the Market:  Observe changes in the product life cycle.  Observe changes in consumer preferences and trends.