Is There Anyone Out There? How To Identify a Market For Your Small Business

Once you have hit upon your idea you are likely to be full of enthusiasm and raring to go. You can see the potential and you can’t wait to get started. But … is there anyone out there who is as keen on your product as you are? Many new business owners fail to ask this question at an early stage and it’s only when the doors open do they realise they may have been hasty!

Having spent time searching out and refining your idea you have to spend equal time confirming that there is a market for your product. It may seem like a daunting task but there are 3 logical steps you can take.

Identify Your Geographical Market

Are you going to sell locally or a bit wider a-field? Can you see yourself selling within a number of regions within the UK or the whole country? Who knows, your product could be suitable for world-wide distribution! It’s important you identify your catchment area because everything else stems from this.

Identify Your Market Place

Having identified your overall market the next step is to find out more specific information.

Industry

You want to find out how many potential customers there are, what the trends are within the industry, what the future looks like. Where can you find all this information? Obtain and search through other company’s brochures, industry magazines, trade journals, industry association web sites, ask your local Business Link if they have any information.

Local Market

If you intend to service your local area you need to make sure that your target customer lives there! Drive or walk around, look hard at the people on the street. Do they match the profile you have in mind for your target customer? Look at the other shops and businesses in the area. Do they compliment your business?

Suppose you wish to set up a second hand shop and you want to establish the business near your home to be close to your family. Where you live is a middle to upper class area. You have to be honest and question whether such a business would do well in this area. However, if you want to open in a low income area, then you are probably onto a winner!

It’s all about making sure that your ideal customer exists in your area. Naturally, if you are purely an e-business then geographical considerations don’t come into it.

Identify Your Potential Customers

Having identified your market place you next step is to identify your potential customers. Are there going to be enough of them to make your business a success?

Your first step is to visualise who your typical customer would be. What is their average age? What income bracket are they in? What sex are they? Are they careful buyers or impulse buyers? How often do they buy products such as yours?

This is an important exercise to do because having built up a customer profile you can then carry out more targeted research to satisfy yourself that the market exists and justifies you starting up. A customer profile will also help you later on when you start marketing your product so making your campaigns more focused.

With a target market and a target customer in mind you now need to undertake research to prove that the market exists and to confirm that you are not being over enthusiastic about demand! This involves seeking views from your potential customers via a survey, which is what we will look at next.

But first we will examine how you go about collecting your data.

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Steps to Setting Up a Successful Small Business

Introduction

So You Want To Run a Business?

Are You Up To It?

Skills For Success

Got an Idea?

Is There Anyone Out There?

Your Legal Status

Choosing a Bank and Opening an Account

Getting The Right Premises and Equipment