Business Planning – Make Sure You Do Market Research

Before you start a new business or release a new product/service it is absolutely essential that you ask yourself the question:

IS THERE A MARKET FOR MY PRODUCTS AND / OR SERVICES ?

Clearly you will not make significant profits if consumers do not like or need your product.

It is essential that you do market research before you invest too much money in preparing the products / services for market. Some examples how to assess the market are listed below:

• To keep your costs down you can do face to face surveys. Make sure you choose the right location and sample of people. For example, if you want to research the public’s interest in a new design of suit carrier, standing outside a McDonald’s restaurant is likely to give inaccurate results. Whereas standing at the entrance of London Bridge railway station approaching city workers should give good feedback whether the market really wants your product. Take the opportunity to seek feedback regarding acceptable price, colour etc.

• If you are proposing to sell products an initial sale via eBay can be useful in evaluating demand and pricing before you purchase a large batch of stock.

• Search the internet, yellow pages, and local directories to get a feel for how many companies are already selling your chosen products or services.

• Visit competitors retail units as a mystery shopper to assess prices and level of service

• If you are offering a service search the internet to assess what your completion are offering and at what price. If that information is not published ring the competitors in your local area and ask questions as if you are a prospective customer. You can ask family or friends to help with this.

• To assess demand from prospective customers, telephone market research is commonly used. Make sure a suitable search database is used to select leads from the right demographic sample, otherwise high costs may be incurred for wasted calls.

• Social media websites such as Facebook, Twitter, and your blog can also be very powerful in eliciting feedback from an audience of literally 100s of millions of consumers at little or no cost to you. To make this effective it is likely that you would need to have built up a substantial following to achieve a suitable sample size.

Good market research will help reduce the risk of business failure.