1/18 New Models, New Business Models
Posted: Thu Jul 14, 2011 4:13 am
Inspired by the poll on "what do you think the future of the hobby is?" I'm starting a thread for discussion of ideas for new business models for the hobby.
Before I start, I have to say I don't have a lot of hope. One reason for this was the tepid response to my inquiry about "1/18 by the numbers:" Without some even minimally accurate quantitative information about market size and cost, there are some serious limitations on what can be done.
But with that intro, here are some more or less random ideas about factors, questions and issues that might have to go into developing some new business models.
** Assuming that the biggest risk in trying to create new 1/18 product is the danger of investment to create a stock of product that can't be sold, or can't be sold in a reasonable amount of time (i.e. relative to other uses of money), production of small lots is pobably an important foundation. This is obviously the basis of the "garage builders," but that seems to be more a personal passion than a business, and is subject to the problem of being exposed to personal interruptions of work-flow.
** Significant profit is probably not something that is going to seriously factor into any "alternative" business model -- at least at first, maybe not for a long time, and maybe not ever. The motivation will likely be personal passion of those involved, and of the potential base of buyers.
** "Subscription" is one concept I've considered from the very beginning of my entry into the hobby, when I realized I'd missed the Golden Age, and that I was getting into something where prices would be constantly rising and new models would be rare or nonexistent. By "subscription" I mean the notion that buyers would pay some or all of the purchase price up front, and buyers would assume a lot of risk up front. This is obviously an element of the established "garage builders." In the case of PH, it works very well -- but he's got an established track record of delivery and product quality. Without that track record, the subscription model is hard to get started with because there's not a reservoir of trust to build on.
** Setting aside the "chicken-and-egg" problem of trust in the subscription model for a moment, I've considered a concept of "amplified subscription" -- where a group might put money into a model sufficient to not only make their own model, but a run larger than necessary to provide one unit to each subscriber. One major legal problem with this is that it looks, walks and quacks like a "security," which brings on a whole host of regulatory overhead. This isn't necessarily insurmountable with some creative lawyering, but it's an issue.
** Machinery and tooling purchase is an issue I would so like to have more information about. I've seen SOME discussion of small-scale injection molding machinery in the same universe of people who created and use the MakerBot. Then there's "desktop CNC" for milling. There ARE people who are experimenting with and implementing the use of this kind of technology on a small, personal level. With the right level of commitment, I think it might JUST be possible now to actually create a CAD-based design, CNC tooling and injection-molding production line on a small scale, right here in the good ole US of A. But one person couldn't do it alone, of that I'm sure -- at least if he wants to keep a real job in the real world.
** But that brings me to the closest I've come to integrating this idea. I can IMAGINE a business model where individuals specialize in different parts of the production process on a personal basis and, TOGETHER, make up the whole business on a distributed basis. The whole integrated process would involve elements of all of the things mentioned above. It would require coordination and the ability to do things on a trial-and-error basis, especially at first.
I'm out of time to write now, but Id be interested to know what others' thoughts are on this subject.
Before I start, I have to say I don't have a lot of hope. One reason for this was the tepid response to my inquiry about "1/18 by the numbers:" Without some even minimally accurate quantitative information about market size and cost, there are some serious limitations on what can be done.
But with that intro, here are some more or less random ideas about factors, questions and issues that might have to go into developing some new business models.
** Assuming that the biggest risk in trying to create new 1/18 product is the danger of investment to create a stock of product that can't be sold, or can't be sold in a reasonable amount of time (i.e. relative to other uses of money), production of small lots is pobably an important foundation. This is obviously the basis of the "garage builders," but that seems to be more a personal passion than a business, and is subject to the problem of being exposed to personal interruptions of work-flow.
** Significant profit is probably not something that is going to seriously factor into any "alternative" business model -- at least at first, maybe not for a long time, and maybe not ever. The motivation will likely be personal passion of those involved, and of the potential base of buyers.
** "Subscription" is one concept I've considered from the very beginning of my entry into the hobby, when I realized I'd missed the Golden Age, and that I was getting into something where prices would be constantly rising and new models would be rare or nonexistent. By "subscription" I mean the notion that buyers would pay some or all of the purchase price up front, and buyers would assume a lot of risk up front. This is obviously an element of the established "garage builders." In the case of PH, it works very well -- but he's got an established track record of delivery and product quality. Without that track record, the subscription model is hard to get started with because there's not a reservoir of trust to build on.
** Setting aside the "chicken-and-egg" problem of trust in the subscription model for a moment, I've considered a concept of "amplified subscription" -- where a group might put money into a model sufficient to not only make their own model, but a run larger than necessary to provide one unit to each subscriber. One major legal problem with this is that it looks, walks and quacks like a "security," which brings on a whole host of regulatory overhead. This isn't necessarily insurmountable with some creative lawyering, but it's an issue.
** Machinery and tooling purchase is an issue I would so like to have more information about. I've seen SOME discussion of small-scale injection molding machinery in the same universe of people who created and use the MakerBot. Then there's "desktop CNC" for milling. There ARE people who are experimenting with and implementing the use of this kind of technology on a small, personal level. With the right level of commitment, I think it might JUST be possible now to actually create a CAD-based design, CNC tooling and injection-molding production line on a small scale, right here in the good ole US of A. But one person couldn't do it alone, of that I'm sure -- at least if he wants to keep a real job in the real world.
** But that brings me to the closest I've come to integrating this idea. I can IMAGINE a business model where individuals specialize in different parts of the production process on a personal basis and, TOGETHER, make up the whole business on a distributed basis. The whole integrated process would involve elements of all of the things mentioned above. It would require coordination and the ability to do things on a trial-and-error basis, especially at first.
I'm out of time to write now, but Id be interested to know what others' thoughts are on this subject.