Market Research – By now, you should have begun writing your business plan. Your preliminary work, as described in the article “Business Plans – Doing Your Homework,“ should be complete. You should have your company overview sketched out. If not, head on down to this article “Creating your Image – Company Overview” if you need some useful tips for making a strong company overview. Remember, having a good company overview will make a robust statement for investors and anyone else who is reading your business plan. This will indicate your seriousness and aspirations for your business and having that element in your business plan is crucial for the document’s success.
“Our aspirations are our possibilities” – Robert Browning
Once you have written chiseled out your company overview, it is time to get down to the gritty dirty work of the market research. The market research is not only vital for investors’ knowledge but also yours. You may have done your research and understood your industry better, but it is important to structure your research out so that it makes even more sense. The market research that you had conducted while doing your homework may be haphazard and all over the place. Furthermore, while structuring your research, you may actually learn a new trend or industry statistic that may cause you to rethink a few steps.
“If we knew what we were doing, it would not be called research would it?” – Albert Einstein
It is important to get the industry analysis correct, as it will help those reading the business plan familiarize with your industry. Getting the right research will go a long way in building investor confidence as well as demonstrating the opportunities and liabilities of your business. Furthermore, sometimes it helps the layman better understand your business by knowing about your industry. The market research can be vital information to anyone as it directly impacts the overall thought process and approaches towards business.
“Research is what I am doing, when I don’t know what I am doing” – Wernher von Braun
For your research, it is important that you pay attention to articles, reports and other professional papers that are credible and reliable.
So, how should you structure your market research? Well, here are some tips in preparing this section that will be fluent, easy-to-understand and logically structured.
1. Target Market Statistics
This refers to the overall city/country that you are targeting. This would include the following information:
- GDP
- Population
- Recent economic trends
- Overall industry information that will determine the health of the target market
For example, say I am opening a restaurant in Dubai, then I would include information such as economic trends of Dubai, number of tourists, locals’ vs expats, and other similar facts about the local population.
2. Global Industry Statistics
This is where you actually start providing information about your industry. This section should have information on the overall performance of the industry all over the world. This will include the following information:
- Recent trends and statistics regarding overall output
- Impacts/factors that are affecting the industry
- Overall revenue generated by the industry
- Regions where this industry is performing particularly well
- Future predictions and expectations of how the industry will perform throughout the world
- Any other global industry statistics that indicate how the industry is performing throughout the world
It may seem a bit strange to include information about the entire world even though you may only be targeting a specific city/country. However, it is just as important to understand how the industry is performing in other parts of the world, as this information can identify significant trends and other statistics that may influence the overall industry, and in turn, impact your target market as well. Investors look for good information as knowing that your industry is performing well in other parts of the world will give them a significant boost of confidence. It may also reveal ideas that you can use when targeting your local market.
3. Target Market Industry Statistics
This will include the same type of information that you found for your global industry analysis, except this section will be focused on your target market segment. You may want to go into as much detail as possible in this section, adding to the information you found for the rest of the world. It will reveal information regarding the competitiveness nature of your industry, the expectations and trends, risks and other environmental factors that may influence your business. This will also give investors further confidence in your business idea.
Research is just as useful as how well it is presented. You may have all the right facts and figures that will put your business plan on a pedestal, but when it’s disjointed and uncorroborated, it’s useless! Take your time, don’t rush yourself, organize, structure and execute!
Confused on where to start your research, let us help!
