I recently rented a beautiful red Model 3 on Turo in Seattle, and was excited about finally testing a car I would have loved to own one day.

My excitement disappeared at the end of the week with a terrible recharging experience when the battery went under 10%.

Initially, we targeted two nearby ChargePoint stations, which turned out to be non-existent. We toured the block three times and couldn’t find them.

Then we sought EVgo, which was real and easy to find, but none of the CCS or CHAdeMO connectors fit the Tesla-provided power adapter. Now we’re down to 8%.

Luckily, Google Maps indicated that a Tesla Super Charger was only 10 mins away. We headed there, and searched, searched, and searched, no chargers of any kind. To its credit, the Tesla map did not indicate that there would be a charger there, but we didn’t believe it.

Now running on fumes, we headed to a destination charger...

There are a thousand and one elements to managing a retailer relationship, we will examine the most important ones. But first, some terminology.

Nomenclature

• Selling to a retailer is called selling in
• Selling to consumers is called selling through
• Running out of stock is called selling out

Vendor Agreement

The process of becoming a vendor of record is tedious and time consuming. You will be treated to painstaking agreements that explain, among other terms:

• how their procurement works so you can adapt your system to it
• what’s the minimum liability insurance that you will carry
• what are the markings on the packaging and cartons
• what regulations and retailer-specific product requirements with which you must comply
• how will every shipment be inspected for quality control
• what is the policy for returning defective items
• what is the level of customer support you will provide
• and...

Previous article: Distributors

Retailers are the gateway to the consumer, and as such hold the most power in the supply chain. And they’re not shy at wielding it either, they are experts are offloading costs and risks on their suppliers - you.

This said, selling directly to retailers removes the distributors from the equation and allows you to keep a larger share of the profits. It also affords you control over packaging and in-store messaging, so you can build a brand.

Do the benefits outweigh the risks? For a strong product, yes. If you’re not sure, adopt a distributor strategy instead, which often means avoiding the US market until the product has proven its worth elsewhere.

In Bossa Nova’s case, that’s exactly what we did. We demonstrated strong sales in Europe, where distributors took most of the risks, and gained the confidence to enter the US market and sold directly to...

FOB stands for Free on Board in INCOTERMS terminology, and means that you complete a sale by delivering the merchandise at a specific sea freight port, typically close to the factory.

The title (ownership) of the merchandise transfers to your customer upon delivery to the vessel. Your proof of delivery is the bill of lading, a confirmation by the vessel captain that they have received your merchandise.

Typically, you deliver the merchandise not to the captain directly, but rather to a freight forwarder, whose job is to book the vessel, receive the goods and load them on the vessel.

Previous article: Online distribution

Distributors buy from you and sell to retailers. They take a portion of your profit, but in return fund your inventory and marketing, and they handle retailers on your behalf. When you’re new and have everything to prove, they’re your ticket to relevance.

Inventory

Owning inventory is risky business, because you freeze your money in the goods and can’t use it to pay salaries and finance your operation until you sell. And inventory can be very expensive. So distribution is really about having the money to own inventory and the experience to manage the risk.

A distributor of good standing will pay for your product at delivery, which means that you will be able to pay the manufacturer directly from sales. This is much cheaper than all other forms of production financing.

In addition, the distributor may agree to advance cash for long-lead items...

Distribution is risky and expensive. Depending on how you go about it, it can make you or put you out of business. And the line in-between is thin. Here are lessons we learned from the trenches.

To gain wide distribution of a product, it needs to get on retail store shelves. As of 2012, more than 80% of sales still happened in brick and mortar stores. Online sales are growing, but are still small. So you will ultimately want your products in stores, but don’t rush.

In a series of articles, we will cover three distribution models - online, distributors, and retailers. First, online and crowd funding.

Crowd Funding

Ideally, you want to test your product before you scale distribution - promote your product, test demand, and minimize inventory risk. Remarkably, you can now pull this trifecta with crowd funding. You will probably need to seed the promotion with online media articles...

Here are highlights of the things you’ll need to know and do to get a company off the ground and a physical product to market.

The idea

At the beginning was the idea. You think of something new, innovative, never done before, and super importantly, that excites you. The next step is to validate it.

• Are you solving a real problem? Will your invention relieve customers from a pain so great that they will pay?
• Is your solution really great? Are you 10x better than all existing alternatives?
• Is the market BIG? Generally (but not always), a big problem means a big market. The point here is that you will work so hard on your startup regardless of the market size, so you might as well ensure you have make the biggest impact possible.
• Is the market growing? That’s what will make investors tick.
• It is protectable? That keeps them ticking.

The team

Since it’s your first company, you’re...

When my partners and I started building our first product at Bossa Nova, we craved information about the hardware business. We collected every last piece of knowledge we found by interviewing other entrepreneurs, hiring consultants, and reading reports, but this barely scratched the surface. We wished someone had written the book that explains all the steps required – alas we found none.

With hindsight, much of what we learned over the years at Bossa Nova can be codified for the benefit of others. These writings attempt to capture this knowledge and make it available to first-time entrepreneurs. Hopefully it will give you visibility into what it takes to build a hardware business, and offer guidance and tools to the extent possible.

You should bare in mind that the experience related here was gathered in the toy business (Bossa Nova built and sold about half a million robotic toys), so...

A startup is the land of the extremes – it is incredibly intense and all-consuming, but also incredibly rewarding and fulfilling. You work every waking moment and love every minute of it. There is no middle ground, no easy way to do it – it’s all out or bust.

As an entrepreneur, you will have to live with uncertainty and quickly get comfortable with it; you will have to wear so many hats that your head will spin; you will have to frequently tap your energy reserves; you will drive your body to the limit of its physical strength; you will have to face seemingly insurmountable obstacle almost every morning, and surmount them by dinner time; you will face non-believers and proceed against their best judgment; you will learn to tame fear and at times terror and accept them as a normal course of business. And as if this wasn’t enough, you know that you have a 90% chance of failure, but you...