Let’s use two people, Sherwood and Johanna, and their two product ideas—French sailor shirts and a how-to yoga DVD for rock climbers—as case studies of what the testing steps look like and how you can do the same. Sherwood bought a striped sailing shirt in France while traveling last summer, and upon returning to NYC has been continually approached by 20—-30-year-old males on the street who want to know where to get their own. Sensing an opportunity, he requests back issues of NYC-based weekly magazines aimed at this demographic and calls the manufacturer in France for pricing. He learns that he can purchase shirts at a wholesale price of $20 that sell for $100 retail. He adds $5 per shirt to account for shipping to the U.S. and arrives at a per-shirt cost of $25. It’s not quite our ideal markup (4x vs. 8—10x), but he wants to test the product regardless. Johanna is a yoga instructor who has noticed her growing client base of rock climbers. She is also a rock climber and is considering creating a yoga instructional DVD tailored to that sport, which would include a 20-page spiral-bound manual and be priced at $80. She predicts that production of a low- budget first edition of the DVD would cost nothing more than a borrowed digital camera and a friend’s iMac for simple editing. She can burn small quantities of this first-edition DVD—no menus, just straight footage and titles—on the laptop and create labels with freeware from www.download.com. She has contacted a duplication house and learned that more-professional DVDs will cost $3-5 apiece to duplicate in small quantities (minimum of 250), including cases. Now that they have ideas and estimates of start-up costs, what next? Besting the Competition First and foremost, each product must pass a competitive litmus test. How can Sherwood and Johanna beat the competition and offer a superior product or guarantee? 1. Sherwood and Johanna Google the top terms each would use to try and find their respective products. To