Editorial by Juan Carlos Lopez

Arnold Booth

Clear Signs of Death

It seems that people are blind to the obvious maybe because they want to be or maybe because they simply are not involved in business. In the last few years many supplement companies have come and gone, only the larger ones have been able to stay consistent. But what is reason? Many female competitors don't seem to find a consistent company who is going to help them out in and out every time. Some do, but again its about choosing and understanding the basics of how a business works.

Basic math is our biggest indicator, a new company is usually a company who has capital which is borrowed but their income doesn't exist yet. They have to make a product, advertise it and pay staff to run the business. Let's put numbers on it

Production Cost: $30,000 (Manufacture of supplements)
Marketing: $20,000 (includes booths and ads)
Staff: $50,000 (includes booth models)

This is a rather simple and small budget that allots to $100,000 and basically you will spend that in one year and then you will have to make at least that much money back. If you do sell the product you could make close to $100,000 but that is if you sell that many.

After a few years you might have a decent income but things change and companies need to re-adjust. Magazines are dying so online is cheaper and better to market anything. Other products market better than you do and therefore you loose sales. So here are a few clear signs of death or near death

1. Decrease in marketing
2. Not having a booth at the larger shows
3. Less demos
4. Decrease in sponsorships

Another big sign of death is over spending, companies that from one year to another spend a lot of money is because they are trying to make more money. If their tactic is wrong they will fail completely. Sometimes they rely on federations to help them out. Some supplement companies want to even have a clothing line, that will surely be a failure of not marketing to the mainstream people.

In summary you could say that if your supplement company only markets to the fitness industry right there is a clear sign of death...

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