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Why sell dumbbells?

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I am often asked why I started FringeSport. People ask, "Of all the things to do, why sell dumbbells?" I told them that if I only wanted to make money, I would have tried the bank or the oil. I have a Mr.B.A., after all.

But I took the path less traveled. I started a dumbbell business. I have considered:

  • Passion,
  • Margin,
  • A niche growing market,
  • A passionate clientele,
  • Regular customers,
  • The potential to build a brand,
  • Defensibility against the Amazon.

In this post, I will examine each of these factors. I will share my thoughts from eight years ago, when I started FringeSport, and how those thoughts evolved.

Passion. Once, I told a friend in a business school that I wanted to work for an industry that fascinated me. He replied: "It's terrible, I would hate working in this kind of business."

I was shocked and asked him why. He said, "What if I end up hating my business? So I would hate my passion. "

This is a good review, but it does not apply to me. Another strong criticism is that you can become passionate about everything that makes you money. But to be the best in the world in my profession, I needed to be passionate.

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I still think like that today.

Margin. Before I started FringeSport, I worked for an e-commerce company that earned 20 to 30% gross profit. Nothing better than that, I thought, would be great. I have therefore looked for a company in which gross margins would be at least 35%. The dumbbell industry, I suppose, could do it.

I changed my point of view. If I started a business today, I would look for a much bigger markup. I would like to buy something for $ 1 and sell it for $ 4. Or maybe a distributor sells it for $ 4, and I sell it to the distributor for $ 2. Both would produce gross margins much higher than 35%.

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Simply put, it costs a lot of time and money to build a brand. I now prefer a product with high gross margins to afford to build this brand.

Niche but growing market. I could see a trend with functional fitness, such as CrossFit. I thought it was going to grow. The dumbbell market was initially very niche. Competition was weak and the market would become viable as it grew.

I always agree with this approach. If I started again, I would look for a niche that is growing. Examples are obstacle racing races and Ninja Warrior competitions. This kind of running and training is likely to increase over the next five years.

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Passionate customers. By launching FringeSport, I wanted to sell to customers who cared about the products and the brand.

I always feel like that Although with the rise of Amazon, it is easier – but not better, no doubt – to create products and brands that have fewer passionate customers.

Faithful customers. I did not anticipate the rise of underwriting companies. If I started again, I would try a product for sale via subscriptions. It would provide a high lifetime customer value because the business model assumes repeat sales at regular intervals.

Brand potential. This one is ironic. Although I think I have chosen a good niche with a lot of brand potential, I have learned that I am not the biggest brand creator in the world. (Eric Bandholz of Beardbrand, on the other hand, is a magician to build his brand.)

But I choose a niche where the brand counts for customers. I would do it again and choose a niche with a strong branding potential.

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Respondent against the Amazon. Eight years ago, I was paranoid about Amazon who was depriving me of my belongings. It turns out that I had reason to be paranoid – but not paranoid enough! These days, I think of Amazon as both a sales channel and a competitor.

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What do you think? What factors did you consider when you started your business? Let us know in the comments below.