Eric Jordan, founder of Pure Edge suggests that one of the greatest realizations he came accross in building a new product for the very first time is the concept of a producer / consumer loop. Traditional perspectives of business models view producers on one side of the equation and consumers on the other. Like this:

Producers | Consumers

But that’s not really an equation at all. An equation with producers on one side and consumers on the other would look like this:

Producers = Consumers

Producers on one side, consumers on the other. Find things you want to buy, and if it’s not there, then build it. If you produce something you want, you are both the producer and the consumer. Immediately a feedback loop is created. You’re also building something that is already sold to at least one person, and hopefully if you want it, you know of few other people who want it. This may not be so important if you have established yourself as a businessman with lots of experience, but as a first time entrepreneur you’re going to face more challenges related to inexperience and mistakes. To make up for this you’ve got to have the passion and understanding of the product that will allow you to put your head through brick walls and forge ahead.

Tags: choosing a concept, feedback loop, producer and consumer relationships
Categories: Lesson, Bachelor of Commerce, Entrepreneurship, Business
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