The Journey: Take Your Idea & Build a Business

In addition to the sales proposition, it is important to have a customer service or support strategy in place in advance of selling any product or service. What can customers expect from you? If you decide to build the service model inside the channel with partners like wholesale or distribution partners, what are your expectations of these partners? For example, sales commissions will scale as a variable expense. Every time you sell a product, you owe someone a commission. However, selling more products might not change your cost for accounting or rent. As you think about margin allocation, it becomes important to understand the dierence between your xed and variable costs. Doing so allows you to gure out your break even point and how your prots will scale with volume. Again, there is plenty of information available on “break even analysis” online. Do your research and understand your prot engine.