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Entrepreneurship

Before you start up your business it’s not just advisable, it’s absolutely vital to find out whether there is a market for your business idea. There are three areas you need to be aware of to make sure you’re onto a winner…

The market sector

You really need to get an idea of demand for your products. You need to get wise to any trends or likely future developments such as proposed legislation or technology changes that may affect you.

You need to find out if there is sufficient demand for your product or service. To do this devise a questionnaire and ask friends, family, contacts and neighbours to fill it in. You can also set up a quick online questionnaire and sent it to your contacts on Facebook (for example). Get people to test your product and service and give you feedback on it - beg friends and family to be honest and impartial.

You also need to find out if these markets expanding or declining. So establish what the current trends are and do some desk research. You could try the following sources for market reports:

  • Key Note (www.keynote.co.uk) is a market research company providing a range of market reports that can be purchased online for approximately £300
  • Mintel (www.mintel.com) specialises in publishing reports on European and US retail markets
  • Datamonitor (www.datamonitor.co.uk) covers more than 300 international markets in the consumer, industrial and service sectors
  • Scavenger (www.scavenger.net) for low-cost synopses covering 60 key UK market sectors

Get information about your customers

It is essential to accurately define as much detail as possible about who will buy your product or service, so that you can target your marketing efforts precisely towards your target audience in terms of age, gender, socioeconomic status, profession, location, buying habits, ethnic background and interests.

You need these specific groups of people (or businesses) to buy from you, so you need to find out how much they are prepared to pay and how often you could expect them to purchase from you.

Information about your competitors

Thorough research will help you to understand your competitors’ business activities, performance, successes, failures, marketing methods and so on. This research will enable you to identify the following:

  • Who your competitors are, how many you have and where they are located
  • What your competitors sell, and how they promote their products or services
  • Your competitors' strengths and weaknesses, and how you can make your business different
  • If other competitors will enter your market in the near future

You can find this information out from directories of trade associations and trade publications that should be available form local city and central libraries. You should also ask if they hold any of these databases: FAME (Financial Analysis Made Easy), Dun & Bradstreet Key British Enterprises (KBE) or Experian. Alternatively, you can identify your business sector’s trade association at www.taforum.org and browse a directory of trade publications at www.tradepub.com.

There are many guides available from the Business Link network: www.businesslink.gov.uk