Service Vs Product Based Startup – Which one is best?

1. Service Vs Product Based Startup – Which one is best? Posted on October 30, 2018 by TechFluenzer Being new to the Startup world, fresher or student you must be confused and wandering that where should I invest my money or implement your unique startup idea? Firstly, you should be very clear if you want to start a Product based firm or Service based firm. It depends on solely on the list of things that you have with you, your priority and your ability to carry out the tasks needed in any particular firm. Lets discuss these “list of things” below referring to both Service and Product based firm along with their pros and cons:- Which one costs less? Do you have fewer funds? If you are looking to start with a small amount of money than Product is not at all a good choice. As product firm needs a lot of money to start from scratch from establishing your product and to maintain it until it is totally ready to sell and reach to the target users. You need a lot of money for marketing in the world to promote and educate the audience that your product exists and serves so and so solution to the problem so that they can at least read and learn about you that something like you exist. You need more and more money to fit your product in your targeted users mind that your product is revolutionary and serves like no one. After doing this much you can succeed by urging 10% of the users to buy your product. There is somewhat relief in going toward Service based company as you don’t need lots and lots of money in starting. Here I don’t mean that you don’t need at all, but in comparison to Product you can start with small amount when starting from one or two people only as there will not be any expense to give salary and maintain infrastructure as you can grow the company when you get some fund collected with you as an individual. Flexibility in terms of Geography

2. If you are planning for Product based startup then you can get bind in terms of geography to deal with local buyers. This is restricted only to those kind of products that are built to serve the needs of local people and that cannot be served internationally. There are many products that can be soled globally by strong marketing and again you need lots of money here. Again Service based is blessed in this aspect also as you don’t have limits in geography. You can reach the clients and needy people globally without being in person as you can work remotely by serving your services very easily. You can reach out worldwide to any region to explore and expand your services which eventually brings in lots of opportunities. No. of target users. You are also tied in the number of your targeted users as your product serves to a selected people in their particular field. Again it depends on your product idea if it is potential to reach a huge number of end users. Since no field is having few people connected with it and hence without any doubt you can also reach as many users you want to sell your product by pursuing your goal. There is no limit in Service based startup for target users as already there is a huge amount of organisation and people whom you can reach out to serve and explore your services. Service based companies serves basic need of the era by fulfilling the technical needs of every individual in many ways and hence there is no end. Unaware of the challenges You are aware about the technical challenges that may arrive in your product as the features are limited to certain level which can be tackled in less time and small efforts. You need a team who can dedicate on your product to constantly maintain and upgrade your product with immense features.

3. You never know which opportunity can strike you with which challenges as the technology is varied and deep to accomplish the complex projects. You need to be updated with the latest technology to compete in this competitive world as everyone is looking for the new and easy strategies to overcome the needs. You need to be ready with talented and updated team with you to deal with all kinds of challenges. Pricing In product based, you set the price based on the features and functions that the customer desires for their needs. Mostly the pricing of the product is considered standard and there is no sort of compensation on customer’s demands unless you decide to offer discount to them for a certain period. In service based, many entrepreneurs sell their developing skills in very low amount to win the projects in starting. You can reduce your rates to win the projects but at the same time you should maintain the market value instead of laying down on your feet. It doesn’t mean that you must always deliver for higher rates as many times you have to think many ways in different situation. But it is always said to start with small and then lead to the big ones. Uniqueness of your product or service idea Literally there is no place in market for the existing products as it is very tough to attract the customers from your already existing brands that are already serving these services. You can only rock in this field if you have a really great and unique product idea to provide the solution to the world that makes them use your product in any case. Services can rely on the uniqueness based on the technology that you choose for serving your customers. You can also win in the race of choosing the technologies as many people are looking for the latest technologies and very less of us adopt those technologies for serving the world. Where is more competition? You will see less competition in Product based as due to so many unfavorable reasons people don’t refer to choose it as there Startup plan. If you are standing alone in the world with an idea that everyone will want to prefer than you are the winner from there itself. So if you have a great idea and lots of money then you must enter in the Product based firm to reach the highest goals with less competition in the market. There are countless Service based firm present in every corner of the world which is not at all a new or unique thing to start with. Hence to win out of the already present organisations to serve your work becomes too much competitive and hard. You need to put a lot of effort to gain the trust of people that what you are serving best that the others are not. Decrease in travelling to promote your business in service based which eventually reduce the travel cost Depending your product you may need to travel a lot to almost every place as per the client’s request to give a demo of your product and explain it through a presentation. You never know that the customer will buy the product after going through the demo and you end up by spending the travelling cost to explain the whole thing in personal. But on the other side,

4. many of them have made their demo online by explaining through video calls or through a video presentation. There is very less dependency of travelling in Service based firm, as everything is done online from verifying the developers to test through interviews, deliver the project online and make the payments as well. Therefore the travelling part comes only towards the CXO or high level executive side to make new business relations and establish their presence over the world but rather than in selling they don’t need to roam much. At the end you can decide based on the aspects that are in favor of you that which one is easier to start.