Budgeting for a New Product Launch: How to Stay on Track
You can’t talk strategy behind a new product launch without budget conversations.
While no doubt one of the more challenging aspects of bringing a product to market, budgeting for a new product launch is critical to making informed financial decisions that lend themselves to greater ROI.
But as we’ll highlight here, the actual spend on product launches doesn’t always line up with established budgets — and you may be surprised to learn just how often that is the case.
Product Launches Are Prone to Go Over Budget & Lose ROI
While it’s difficult to apply an average budget for product launches based on varying industries and objectives, one thing is certain: sticking to product launch budgets is a sticking point across the board.
In Wellingtone’s 2020 State of Project Management report, project managers at organizations across the globe were asked if they “mostly” or “always” completed projects within established budgets. Of the respondents, only 43% answered yes.
Considering the loss of revenue attached to these product launch delays, only 40% of the survey respondents also said their organization “mostly” or “always” delivered the full benefits anticipated from the project.
What Are Some Reasons Product Launches Go Over Budget?
One of the biggest culprits for excessive product launch costs is poor workmanship. When products fail to meet performance standards, businesses have to deal with the hassle of going back to the drawing board and all of the added costs that come with it: design re-work, manufacturing reruns, extra labor costs, etc.
Connecting this issue to the connector industry, let’s use the example of a contractor manufacturer of heavy-duty assemblies for off-highway trucks. When the manufacturer receives their specialized reverse bayonet connectors for the new piece of equipment, the parts fail to provide the degree of mechanical strain relief that’s required in the field. Losing trust in the initial connector supplier, the manufacturer takes time to find a new supplier and has to go through the design and manufacturing steps all over again.
In other cases, going over product launch budgets is simply a matter of long lead times. Going back to the example above, the specialized reverse bayonet connectors may be the right fit from a physical and performance point of view, but the contract manufacturer isn't able to get their hands on the parts fast enough to meet the customer’s critical due dates. These delays can sour the start of the new business relationship and cause profit loss on both sides.
How Amerline Helps You Stick to your Product Launch Budget
Sticking to a product launch budget means leaning on the right partners. As a provider of circular connector solutions, Amerline is proud to help businesses do just that.
It starts with the high-quality of our products. All of our connectors, assemblies and accessories are tested to ensure dependability and reliable performance under the harshest conditions — with in-house overmolding services available when an added layer of environmental protection is needed.
Then, there’s the availability of our products. From our military background, we’re used to the idea of having products waiting for a customer as opposed to a customer waiting for the product. Our in-house machining capabilities expedite our ability to meet critical lead times, with expedited delivery options available to accommodate tight schedules.
Lastly, there’s our pricing. Our approach to designing and manufacturing custom overmolded connector assemblies — including customized solutions that combine or add functionality that accelerates time-to-market — lends itself to considerably cheaper pricing than the competition.
Collectively, these variables of our business help you keep your product launch budget on track — and in many cases, lower these costs right off the bat.
Let us know how we can help you meet your application’s connector requirements. Request a quote.