To start a new business, you should first ______.

One of the first steps in examining your business idea is to do some research to get to know more about your market. Presumably you already know that a market exists for your product. If you have an idea for a business but you’re not sure whether a market for it exists or is big enough to support your business, you are getting ahead of yourself. If that description applies to you, you’ll need to take a step back and look at finding the right small business for you.
    For those who believe that a market exists, but who want to know more about the size and shape of the market in order to forecast their chances for success, research is the best place to start. Researching your market to know more about your customers and your competitors is a critical step for small business owners. If Procter & Gamble puts out a product that doesn’t sell, they move on to the next idea. If you put out a product that doesn’t sell, you’re out of business.
    When you conduct research, you’ll want to find out the following:
    -Who are your likely customers? Where do you think your business need to be (for example, if students are your customers, you may need to be near schools)?
    -How can you reach your customers? Which marketing options will reach the most customers at the lowest cost?
    -How much will they pay for your product or service? Are you planning to charge too much for your product or service? Are you planning to charge too little?
    -Who are your competitors? Have you also considered those who aren’t direct, competitors but who might nevertheless compete against you (for example, if you sell an online magazine, you’re competing not just against other online magazines but against other products that occupy someone’s leisure time)?
    -How will you be positioned in the marketplace? Will you compete with existing businesses head on or will you try to find a special place?
    For a more complete analysis of how to assess your market, please attend our discussion in the seminar next week in Classroom 250.