A refinement of our venture's scope

Our discussion with Prof. Zak on our feasibility plan has generated new insights for us. We probably have missed addressing two crucial questions that might significantly impact our financial sustainability and attractiveness:

1) What plan do we have for the off-season/dry season?
2) Have we considered customization to make our product distinctive from our competitors?

Given the nature of our venture that sales will only occur during the wet season (from November to June), we need to look for other opportunities to keep our cash flow positive in the remaining six months since we will still have to pay for operational costs. This problem was quite hard to solve as initially we were focusing on how to generate revenues from our raincoat sales. But then I realized that some functions of the raincoat are still relevant to be applied in other motorcycle apparels. For instance, motorcycle is the number one cause of road accidents in Jakarta, so safety improvement is a nice selling point. We can sell similar products that have the same objectives, such as jackets with extra safety features. By similar products, I mean products that have a similar manufacturing process, so we don't have to invest on new equipment, although we also have to do a market research to determine which features should be added. (My answer to the second question can facilitate this need: Online shopping can perform as our market research.)

Furthermore, I agree that offering a standardized product might not be enough to differentiate our product from the competitors. We need to make a product that can be customized. I got this idea from Dell computer that sells customized laptops through their website. They’re not offering a completely different laptop, but by giving more freedom to customers to pick features they want for their computers, Dell has created a very distinctive selling point. I think this idea is very relevant for our venture. Why?

First, none of the established competitors offer a raincoat that is customizable. Even if they do, I suspect that the process would be cumbersome and the final price more expensive than a mass product. I think we can utilize our two potential distribution channels (bike shops and our website) to sell both mass and customized products. Our online shop is suitable to sell the customized products. We can provide an interactive app on our website so that customers can pick the colors they like for their raincoats, add extra features they want or create a logo. I think online shopping is a very convenient way to buy a customized product. The results of our online sales can also perform as a market research: In the bike shops, we can sell basic raincoats with most picked features from our online shop.

Second, by offering customized and mass products, we can target a broader price range. I initially thought that we have to target “in-between” price range, i.e. a price range between the generic and premium markets, in order to capture customers from both markets. However, by selling customized products, we give our customers more freedom to determine their own price. If they don’t need a flashy raincoat, they can eliminate extra features and get a lower price. Thus, this strategy allows us to penetrate both the generic and premium markets.