Posted by admin | Posted in Articles, Business Start Up | Posted on 02-02-2010
As a potential entrepreneur, information gathering is crucial. I have seen many people start a business without appropriate information and it has almost always landed them in trouble – I know because I am often hired to help fix the problems later on. There are many types of information that you need to gather before starting a business, however, due to space limitations I will focus on one: Market Information (not to be confused with Marketing Plans).
Here is some of what you need to find out and some suggestions on how:
- Determine demand for your product/service. If there is a demand, determine the demand size.
- Do a survey – the broader the survey, the more accurate the results
- Do market research – use the internet, the library, the Chamber of Commerce, etc.
- Talk to people in the know.
*If there appears to be little or no demand for your product/service, do not go ahead regardless. Consider modifying your product/service to fit any determined needs. If you decide to “create a need” your product/service, make sure you develop a solid business plan that aims to create that need – and anticipate a much longer return time.
Identify your potential customer.
- Find out who wants/needs your product/service – age, gender, income bracket, other variables
- Find out how much your target market will be willing to pay for your product/service
- Find out how often they will purchase and under what circumstances
Analyze your competition.
- Find out who you are competing with locally, nationally and internationally (if applicable)
- Find out as much about your competitors as you can – length of time in business, successes and failures, relationship to their customers, products/services offered
- As you analyze your competition, make notes about what you can and will do better than them and note any areas you will need to improve on before you begin (i.e. product knowledge, sales skills)
Whatever business you are considering, start your information gathering now. I currently have a client who does not plan to open her business for almost 2 years but she is actively gathering her market information – visiting competitors and analyzing them.