Originally posted by jedi:
Not everyone in this world change blades very often, and also NOT everyone use razor blade!
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You start brushing your teeth from yr 1 to the day you die, but if you are a guy, you start to use razor blade when you are 20.
Can you see the difference between razor blade & consumable item?
If you wanna compare with computer parts, can!! let's talk about HP printer.
in a HP LaserJet printer, there will be many parts such as heating elements and etc. Although HP printer is very famous in the world, but HP is the only company on Earth that produce heating elements for HP printers.
But let's look at toner & cartridge, a lot of remanufacturer toner and refill cartridge running in the market.
Why these competitors do NOT want to produce heating elements and they start to bang the toner market?!
This is because to a printer, toner is a consumable item and heating elements is just a spare parts. Consumable item will never ever be saturated BUT if they start to produce heating elements, they will be in deep shit.
cheers!
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You're correct when you say that not everyone uses toothpaste. But take a look at the size of the market of razor blade users. Guys use them from age 20 onwards.
Of course it is not as large as toothpaste. But hey, one company(figuratively speaking) to provide for Singapore?
There is a point of equlibrium in all markets. And that happens to be the saturation point also.
There will come a point of saturation. Paper, stationary, toothpaste, toilet paper, hairdressors, transport. These are all consumuable products and services. Saturation point does allow slightly more than average number of companies, but on the long run it will even out.
So if one goes in the market with 3Ps. Make sure they are strong 3 Ps.
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Why don't companies produce heating products? The other point to consider is patenting.
Photocopier industry is now ruled by Canon at 70% market share (if I remember the number correctly). It's freaking profitable and it's not a consumable product.
Why not enter into this industry?
Canon entered the market to push out Xerox. Canon patented what Xerox didn't. 2000++ patents on one machine.
(Singapore has only less than 500 for the whole country.)
Let's go back to the Gillette example. It's clearly a consumable product with a huge market.
Why don't others enter this consumable market?
Patents again.
Gillette patents everything from the angle the blade is tilted to how the grip is made. Everything.
Going back to toothpaste, it's the other consumable market. Why not more enter? Patents again. The newcomer will find it hard to create a new toothpaste without violating the patents.