Business modelsVenture Capital

Proven value-add characteristics for physical products

By September 20, 2013 No Comments

Alan Patrick just wrote a post about London’s prospects as a centre for manufacturing. Along the way he wrote about the characteristics that are proven to add value to physical products:

  • Short Lead Times/Available now
  • High Design Input to create differentiation
  • Fast change/Fashion – make things that are hard for long lead time supply chains to replicate quickly
  • Design unique capability into a product

I love a framework, and this is a good one for thinking about the potential for physical products companies. This is a hot area right now, but it’s nascent, and that means there is little to go on when we make investment decisions and advise companies. Making sure that one or two of these characteristics are present and get stronger as the company develops is a good way to go.

And if you’re wondering, Alan thinks that London could be a centre for the manufacture of high value products, but we have cost disadvantages to overcome and would benefit if our schools taught our kids the right things, and if engineers were accorded the same status in society that they enjoy in most other OECD countries.