Tuesday, April 18, 2006
We're pretty ingenius in the way we conduct our market studies. I've seen many business plans from the private and Government sector that based their investment assuming a 1% market penetration of lets say, the PC market globally.
1% perhaps is the tolerable threshold for funders and fools alike. "Surely, if you look at my 150 pages of feasibility study, 1% market penetration of USD 600 billion market is highly achievable." But they forget that the total market is controlled by 3 dominant players who has a stranglehold on the market based on pricing, technology and sourcing capabilities.
"I'm just being conservative, I'm looking at a minimum penetration of 1% with an upside of 20% based on my aggresive marketing plans". Yeah, with the marketing budget being a tiny fraction of the development cost. They expect the product to walk out of the assembly line and sell by itself.
Mostly, they forget that its also 99% perspiration.