Researching Your Market: Is There a Place for You?

Posted on April 20, 2018

Even the best ideas can fail if there’s no market for them. Before starting a business make sure you’ve done some research. It doesn’t cost a dime and can save you money, time and stress. Before taking the plunge do a little online browsing, talk to friends and other business owners and answer the following four questions:

  1. Is there a market for what you’re offering? If you’re considering opening a daycare center and live in a community predominately inhabited by retirees, then the answer is most likely no. On the other hand, retirees do travel, and they do have pets, so perhaps a daycare or hotel for pets would be a better option.
  2. Is the market saturated? Does your city really need another bakery or florist shop? How many are within a five-mile radius of where you plan to be? How much money is spent in that particular industry each year? Is there really room in the market for one more such business?
  3. What’s up with the competition? How’s their marketing? How’s their product? What would you improve or imitate? Can you offer something unique or special that would attract customers over to your business? Scouting out the competition is just good business.
  4. How large is your target audience? Regardless of what business you’re considering, you have to be realistic about how many people your product will actually appeal to. How many “buyers” are in your market? Is there a big enough market for you to make a profit?

If the answers to these questions are positive, then you’ll move on to the next phase. Dig a little deeper. You’ll next need to research information that will help you develop a unique business plan that gives you a competitive advantage. Remember, as the “new kid in town” you’ll have to overcome the goodwill, familiarity and customer loyalty more established businesses have built over the years.

We’ll discuss this deeper research in a future blog.