Fri Jun 22 18
In order for software to create value, or at least the perception of value, we have to give back to the user more than what they're putting in. The user will sit at their terminal and boot up your program. What they're now doing is putting time into using your program. The reason they're investing this time is because using your program would save them time as compared to doing everything manually.
At the coffeeshop next to my work I bought a Reuben sandwich and a coffee. They kept track of my order with a paper ticket which was put on the coffee machine. The barista read my order, made the coffee, and jammed the completed order ticked on a spike. At the end of the day the manager will have to reconcile all the orders with the money in his till (or on his virtual till for card payments) and work out how much he owes the tax department. It would be better if instead of the spike, the barista slammed the ticket into a money-hole where a cute gremlin would take it and add it to the order book for her. This cute gremlin is known as time-saving software.
You don't want to stop the barista from making her coffee. Any process you add in will have to be fully compatible with paper tickets. What you want to do is save time on the counting. Large globo-business solutions for this with all the bells and whistles will provide counting, ticket recognition for 50 different ticket styles, barista-slam analytics, order weight and more. This solution would cost 3.5MM and be available in 40 different countries and 12 timezones. This isn't appropriate for my little coffeeshop. All they need is a QR code reader and a counting app, with some software in their printer to print QR codes. I could probably deliver for $50-70k. Let's say I charge $90k.
To demonstrate the value of this software though, I would have to save the counter $90k worth of his hours. If he values his time at $25/hr then I have to save him 3600 hours before my software starts giving him ROI. So the question to me and my customer is : can a counting app save 5000 hours / year? Considering there are only 3000 working hours (more or less) in a year probably not. Thus we are left with a paper ticket system and a manual counter.
My other option here is that I could wear the cost of development (i.e. keeping myself alive for 4-6 months) and then onsell my finished product by guessing how the customer will use the software. In this case my development cost is the same (40-60k or less if I'm doing it on the cheap) and now I have to convince one (or more) coffee shops that my software is valuable. Suppose that I calculate that my software will save about 50-75 hours/year for an average coffeeshop. Valuing those hours at $20/hour I get to $1000 for installation of my software, and I need 90 customers to get the pricepoint that I want. There would be some sort of pro license for ongoing maintenance and feature updates.
So the question then becomes, if I choose to keep myself alive for 6 months, can I find 100 customers / year for my order counting app while doing ongoing maintenance on existing customers? Curious question.