Hallelujah! For once, good news and good price have come together. This is surely a positive especially given that the South African economy is officially in a recession now and Brazil’s political situation is yet to settle down.
The six month time-line has never been clear to me – six months to what? Getting FDA’s approval? Breaking the first dollar? Both are optimistic in my view since launch cycles of healthcare products are longer and involve multiple steps.
Setting the processes as per FDA norms (this is more work than most companies think) --> inviting the FDA to approve the manufacturing processes --> beginning manufacturing and building inventory (assuming approval in first go) --> piecing together the distribution network, commercially and logistically --> building the brand presence to grab a share of the customer wallet. The last two steps can begin earlier but they still do take considerable time and money. Remember, Cupid has no presence in the U.S. Its India B2C experiment is yet to take off due to branding and distribution challenges so U.S. will not be a cake walk.
Maybe the product cycle is different for condoms – something that Cupid and the consultant they alluded to on their con call can throw more color on.
Either way, this requires boots on the ground and specialized management bandwidth. It will be very interesting to understand how the management plans to leverage this opportunity and what commercialization road map they put in place in terms of production, quality control, regulatory management, marketing, and distribution. I will not be surprised if they opt for specialized partners for some of these business operations. Might lower the margins to start with but will reduce time-to-market.
This is surely an opportunity for Cupid to break away from being an emerging market-focused B2B supplier to a developed market B2C company. Not easy to pull off but the upside potential is significant so getting the right people and partners on board should be priority #1.