As any business owner will tell you, understanding your market and is vital when setting up a business. You need to research many different areas but taking the time to carefully researching your market is rarely wasted as the short and long-term benefits can be significant.
Over the last 12 months, as the pandemic affected businesses around the world, many took this opportunity to set up new businesses in areas they were passionate about. Even as the world starts to get back to normal and businesses begin recovering, some people take the plunge every day and decided to set up their own business. To those of you out there who may be reading this and are thinking about joining those brave people, we hope the points highlighted below about researching your market helps you understand the importance of this area.
Competitors and location
Two of the most important areas that need to be researched when setting up a business is the area you want to base your business in and also the competitors you will have. In some cases, these two go hand in hand. If you are setting up a retail or service business, the number of similar competitors in a specific location can impact your decision to base your business there. Tania Zahoor Rashid, one of the co-founders and directors of the award-winning London-based cosmetic clinic Aesthetics Lab spoke to us about this. “We are lucky in our location to be a local monopoly, and that gives us a competitive edge. Of course, it wasn’t just luck that made us choose this location – after researching many areas, we settled on Primrose Hill, and the fact that there were not many clinics around made it very attractive.” It should also be said that doing competitor research is fair and to be encouraged as long as it is done correctly. This can help you understand the level of service you need to provide and potentially highlight areas where you can improve on what is currently available.
When starting a business, there are lots of areas that may be new to you. The day to day running of the business may be easier for you based on previous experience, but unless you have had the experience of running a business, there are some aspects that will be completely new. If we just look at the financial side of running a business, this needs to be something you fully understand before starting up. Tania explained that along with her co-founders, they “spent two years researching and setting up the business before we opened doors.” Taking this time allowed them to plan out their steps and better understand what they needed to run their business successfully.
It goes without saying that staffing is a crucial part of any business. While it may seem that there are lots of people who would want to work for your business, in some areas, it’s more difficult to find and hire the right staff, and this is something you need to think about. In the beauty industry, Tania told us that “investing in the staff is very important and picking the best within the industry.” However, in a competitive industry such as hers, this can be challenging “due to the fact that other beauty clinics do want to keep the experienced staff and they seldom have to look for a job.” Being aware of a challenge such as this before starting a business can help prepare you and help you overcome it.
Overall, the importance of carefully researching your market before setting up a business can’t be understated. By taking the time to research the market properly you’re setting up in, you’re giving your business a better chance of success than someone who doesn’t do the extra work and just jumps in. Obviously, there is no guarantee of success, but it never hurts to do your research, and it can really pay off in the end.