Follow up new products with Movex and Excel(1)
I am planning to write a series of articles describing an application i Excel used to follow product introduction when your ERP-system is Movex. The idea is based on a running application developed together with one of my customers.
Most theory published about product life cycle shows a bell curve inspired of the biological life curve also often representing quality of human life depending on age. This model is just conceptual, since real life has a lot more complexity into it.
When introducing new products into a market much focus is on the growth part of the curve. Do we get the payback we need for the project or should we stop the introduction before it is to late? Since a new product is new, often there is very little experience to rely on. The expectation of sales must be forecasted in one way or another. If the new product only is a replacement of an older the sales history of the old product could probably be useful. If similar product has been introduced earlier historical patterns could also be used. Sometimes you introduce a new concept built up by many products with internal relations, and your interest is more on the group as a whole.
In the start-up phase you may have more focus on volume, later on the focus will change to revenue and margin. If the x-axis is in days, weeks or months depends both on the product and in which phase the product is in. The model must be capable of many things to prove helpful in the complex process of introducing new product. I hope that the concepts discussed and the application made available will be a good starting point for developing the basic ideas into a easy and useful tool, but to make this happen we will need advise from you, so don’t hesitate to comment.