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Research the Market for your business

Market Research is a basic first step before setting up a business. It is essentially to find out whether your idea is attractive to the people you think might buy it. The big problem is that people find it hard to imagine using things that currently don’t exist. Henry Ford is reputed to have said that if he’d asked people what they wanted they would have said “a faster horse”.

Research does however, provide a critical input to your business development. Talk to people who may be potential customers in an open way. It will help illuminate the issues you may need to overcome to make it work.

If your business idea is an alternative to something that already exists or an improvement on it, you will probably be able to find out about the existing market from existing research. This is called “secondary sources” and the British Library website is a great place to start.

Typical questions that you should be able to answer after your research are :

  • why will people (or businesses) buy this?
  • how do we know that?
  • how many of them are there?
  • how often will they buy?
  • how much will they pay?
  • how do I get my product/service to them?
  • how much does that cost me?