Pretotype 2 - Mobile App for food pricing

Idea

Mobile application to calculate costs, profits and recommended (MSRP) for small scale food selling.

Market Engagement Hypothesis

In the last decade social networks and smartphones have gone from being a niche gadget to being part of our daily lives. This has led to the proliferation of many small-scale businesses and selling operations, categorized as informal and present only on social networks and related platforms, especially when it comes to food, like pastries. These small businesses generally establish their products’ cost using outdated or imprecise techniques, which leads to minimal profits and low supply control.

XYZ Hypothesis

X – At least 30%

Y – Small-scale food businesses owners or individuals selling food

Z – Will download and use the app to calculate costs for 2 of their products.

At least 30% of small-scale food businesses owners or individuals selling food will download and use the app to calculate costs for 2 of their products.

Experiment

Functionality test using an Excel spreadsheet with the cost-calculating formulas already programmed inside.

XYZ Hypotheses

1 – At least 30% of the products’ cost calculated using the app will be different (more precise) than the actual costs calculated with other methods.

2 – At least 50% of the participant’s products costs will be calculated using the app.

3 – At least 50% of the participants will increment their profits by 10%.

Method

For this experiment, the MVP (Minimum Viable Product) method will be used, which consists on an Excel spreadsheet with the cost-calculating formulas preprogrammed inside it. This way, the application functionality is simulated and the UI is simulated using pictures.

Storyboard

The process was as follows: The participant is provided with an Excel spreadsheet which contains the cost-calculating formulas preprogrammed inside it, along with instructions on how to fill it. The participant, using receipts, must fill out the spreadsheet to receive a cost estimation of a specific product. It is also expected for the application to handle inventory control and price tracking, but this MVP didn’t provide that functionality so the interest was gauged via a questionnaire.

Resources

The necessary resources for this experiment are: a smartphone or computer. The only request is to fill out the spreadsheet, so Internet access is not needed. This means that no expense is needed.

The total time spent on this experiment was 6 hours: including creating the spreadsheet, writing the instructions, creating the questionnaire and distributed the MVP.

Results

This experiment had nice expectations, but the reality was other. Compared to the hypotheses:

1 – Around 50% of participants mentioned that the price the spreadsheet gave them was different from the price they had established, which is a 20% from the original hypothesis.

2 – 90% of participants just calculated the cost of one of their products, which is far from the original hypothesis that they would calculate costs for half of their products.

3 – The cost obtained by calculating using the spreadsheet was, on average, 12% higher than the original established price. But this didn’t mean that profits increased, as it is mentioned in the following paragraph.

In addition to the previously mentioned results, the final feedback questionary shows that 80% of participants won’t change their product’s price, due to different factors, mainly because of their target audience and local competition. Also, around 70% of the participants said they wouldn’t use it to calculate their prices, and the main reason was it was difficult to use.

With this data, the conclusion for this project is that, in its current state, is not a useful product for the target audience despite the high initial interest.