Expert: Eric Hofer - 5/28/2008

Question
Hello mr hofer and my question is i want to make a health drink to help people that can be good instead of an energy drink that suppose to help you but really don`t.i work part time right now and i really want to own my own buisness can you please help me and give me the direction on where to get started i got some money save i just need to know sources and where to start thank you.

Answer
The process here is not unlike the other items I've explained previously, namely:-
- developing a business plan
- looking for distribution
- considering government validation (for safety of new types of products
 and/or alcohol)
- protecting your idea(s)

So let me direct you to these answers given previously.

Given you're focus on a "new" / "health" & "limited capital" aspects, we should explore the implications...

How are you going to develop the product?  Are you an expert in "health"?  Will you have the research to support claims?  How will you communicate the "healthiness" of the drink?  Will you seek endorsements from people that the public trust, that have a reputation for healthy choices?  

How much are you prepared to pay?  

While the concept of marketing a "healthy" alternative are laudable, let's think thru the logic as to whether there's a market.  

1) Corporations with pockets that I'm sure are 1000s of times deeper than yours contemplate different lines in marketing ALL the time.  1.A) In Pepsico (my background) the "market development" and "flavour scientists" are treated with a reverence usually the preserve of "prophets"...

2) Given these resources, the dearth of "healthy" products on the market; and the twinkling appearances and disappearances of what I would think are the "healthy" alternatives, gives me pause to question...

Is there a market out there?  Would a "David" (vs a "Goliath" of resources and reputation) succeed?  Well, I know that small companies do do well - and are eventually absorbed by the biggies (my partner, for example was instrumental in Sandora's Sales Ops - and they were a couple of university professors ... and Pepsico/Americas bought them....).

You're still tied to the a "part time" job; this is a mammoth undertaking - which will require you motivating 10s (or more people).  You and many of those you motive will effectively be living off savings - which will also have to fund the product development.  

Can you actually afford to do this?  Are you going to borrow from friends & family?  Do they have these resources?

I don't know you personally nor and can only infer from the points you mentioned, your diction and punctuation that while motivated you'll still face these other challenges.  

Don't be deterred! It's not insurmountable.  New products arise all the time because of people just like you (and I) that keep plugging away.  Over time you attract other people with vision and eventually have a sufficient collection of skills, shared purpose and drive that delivers a product to market...  The Sandora example above is exactly that (in fact, Coca-Cola is too!).

So from what little I know of you, I'd suggest considering the following approach...
- find some "small" outlet for your product(s) - for example a health food shop, or if you're a local supermarket chain where the store manager is ALLOWED (or even better ENCOURAGED) to stock local product.
- develop some local angles towards marketing; e.g. "a product made right here in town by Antoine"
- get somebody involved with a feeling for marketing; contacts in the community, etc.
- consider a "spin-off" with a local, well established On-Premise (e.g. restaurants) product that is considered by the community as "healthy"; and work out a deal to retail it Off-Premise (paying them a royalty).

You could then "test" the idea; sell some product locally.  In this way you'll resolve the questions around marketing, production, storage, distribution, account management and credit; but if you start "very small" - you'll be able to handle these more easily.

Give me your thoughts as I'm always happy to discuss +/-'s and explore ideas.

Best of Luck!
Eric