Article Contributed by Lionel Luigi Lopez
There are a number of inspirations that typically drive people into becoming entrepreneurs. While some simply want to use their business to exploit their creativity and skills, there are those who want to secure their future by making such an investment. Then there are the ones who are apparently born to become business owners. No matter what the reasons are, setting up a business can be awfully exciting especially when one starts thinking about the positive feedback from consumers and, of course, the money it’s going to bring.
But sometimes, entrepreneurs can be a little too overexcited that they overlook some of the most crucial measures when starting business, one of which is research. They suppose that as long as they have sufficient funds and a great product, it will be easy for them to hit it big. On the other hand, sensible entrepreneurs realize the value of conducting proper research before even beginning to think of the more complicated aspects of the business. This is because they know that the more data they have, the better they will be able to construct a business plan that is not only efficient but also one that has realistic objectives. Facts and figures can also help entrepreneurs manage their expectations once the course of the business starts rolling.
Whether you’re a budding entrepreneur or you’re looking forward to start yet another business, you sure don’t want to take chances especially when you know that you can get reliable information. Without further ado, here are three areas you need to study first before opening up shop.
Market Research
Any level-headed business owner knows how valuable it is to identify their target audience and so should you. Since it is the customers who will be the one to patronize your merchandise, you must ensure that information relevant to them is integrated in the development of product ideas. When you’re able to tailor your product or service to the needs and wants of your target customers, it is easier to establish a connection. This is where a market research, also known as consumer research, comes in.
Among the goals of a market research is to determine the demographic you want to deal business with. The data that can be included in this category are age group, gender, religion, ethnicity, and economic status. Apart from this hard data, you also need to learn the pertinent intangible information such as their preferences, buying behavior, and what influences them to buy or decline an offer.
Consumer research is usually done through surveys where questions are asked during a personal or a phone interview. Marketers also have the option of sending the questionnaire through mail or stage an online poll. You can also make use of market research tools if you wish to be involved more in the data gathering process.
Industry Research
Another category essential to your research work is the industry analysis. It is important that you are aware the products or services similar to yours that already exist in the market. Keep in mind that unless your merchandise is original in every imaginable aspect, it is highly likely that there are business that are already selling what you’re about to offer.
But don’t let this discourage you. Originality is not the only yardstick used to measure a business success. This is also one reason why you need to research about the industry you will be in. This particular set of data will help you visualize how you’ll fit in the industry and what approaches are effective in making the trade flourish or fail. When you conduct an industry research, emphasize on details such as its size and how it is segmented among different markets. You should also look into statistics such as how prices influence the growth of the businesses and the industry itself.
The Internet can be a handy tool if you’re not sure where to begin your industry research. You can look up the key players in the industry and check their websites, which usually have relevant data about the trade. You can also participate in related events so that you can be more informed as well as establish connections to what your industry considers authorities.
Competitor Analysis
As they say, you have to know your enemy before you enlist in the battle. So before you proceed to finally set up your business, you need to know the enterprises you’ll be up against with. As such you need to know the playing field very well from a competitor’s point of view.
When you know who your competition is, you’ll be able to force yourself to push your creativity so that you can have a fresh approach to greet your customers. It may be true that originality isn’t the be-all and end-all of business but you also have to remember that customers are always looking for better alternatives to the products or services that have been availing. By learning about what your competitors precisely offer and what people think of their merchandise, you can make necessary adjustments to make yours set apart.
To be fair, you don’t have to treat your competitors in the business as arch-nemesis. If for anything, you can learn a lot from their successes and mistakes; this is information that you can use to boost your own business.
There is Power in Knowledge
It’s being a cliché doesn’t make it any less true—that when you have the information and data you need, you have the leverage of designing a business structure that could work. Sure, research takes a lot of time and hard work but if done properly, it can be the key to your business’ prosperity. If push comes to shove, you’ll have something reliable to go back to assuming that the research you did is unbiased. At the end of the day, you still don’t lose your advantage.
About the Author
Lionel Luigi Lopez is a business writer, entrepreneur and a musician. He runs a small business in Manila and still active in music. Follow him on twitter @lionelluigi