Request quote

What Is the Real Cost of Delay in Product Development?

Every product development project comes with an anticipated launch date. But as research shows, nearly half the time such projects get derailed from achieving this goal.

According to Gartner, 45% of product launches are delayed by at least one month.

While the reasons for these product development delays vary, from product quality to supply chain issues (among other variables), the cost impact of time lost is the same.

To better understand and communicate the impact of delays in product development, we’ll take a look at the different variables at work.

A Product Launch Delay Example to Quantify the Cost

Looking at our own experiences as a power connector manufacturer, let’s consider the case where a leading welding equipment OEM is bringing a new piece of equipment to the market. The selected connectors from the original supplier fail to meet creepage and clearance standards, and so the OEM can’t meet their anticipated product launch date.

If we operate under the assumption that the company’s new product was expected to generate $10,000 in revenue each week, we can assume that a month’s delay will add up to $40,000. But this theoretical loss is just one ripple of economic impact felt across the business.

When the piece of equipment arrives to the market later, the sales peak is generally lower than the original total expected. This can be attributed in part to the fact that competitors can use this extra window of time to pitch their related products, providing you with less new revenue opportunities to pursue upon marketplace arrival. 

Alongside these new opportunities, it’s also important to weigh what a product development delay means for your existing partnerships. Partners that rely on the welding equipment for their own operations are also planning around these product launch initiatives. When products fail to meet scheduled timelines, their business also misses out on market revenue and can consequently begin to lose the trust of the OEM.

While the loss of a loyal customer can be attributed to their contracted fees, you also need to consider the lifetime value of the customer. With a significant portion of future profits coming from existing customers — and a higher likelihood for successful upsells and cross-sells among this group — you can get a sense of where losses can occur in the span of the average customer’s lifetime.

How Amerline Can Step In to Help Complete Projects On Time

When a welding equipment OEM did in fact miss a product launch due to power connector quality issues, Amerline stepped in to provide a viable alternative fast.

In just two weeks, Amerline tooled up and delivered previously unavailable panel and cable mount custom reverse bayonet connectors with specially modified PC board contacts so technical requirements could be met. With these measures in place, the OEM was able to secure UL approval and successfully bring their new submerged arc welding product to the market.

While this is just one example of Amerline’s rapid turnaround times in practice, it’s a nod to our ability to help businesses launch products on time and see the greatest return on their investment. Not only are we able to get parts to our customers faster, but we also offer expedited delivery options for our connectors to meet even the tightest timelines.

The welding equipment OEM was so pleased with our products and services that the organization’s engineer chose to spec Amerline’s AEC® 95234 connector series for all reverse bayonet connectors used in the project. By developing a stocking program, our team helped to ensure that all future deadlines were met.

Don’t Let Power Connector Delays Stall Your Product Launch

Product launches can only happen as quickly as your partners can move. With faster lead times and flexible delivery options, you can depend on Amerline to deliver technically sound power connectors — from stock to custom solutions — that support your product and its timely arrival to the market.

Ready to connect? Tell us about your project requirements so we can come back to you with a quote.

Find solutions for your connector requirements