You are already busy with writing your business plan, you got the executive summary done, you have written your business description, and now you have to do Market Research, except you do not know where to begin. Do not worry, the key is to make a good plan, and you’ll be all set to go. You will see that with good preparation and a well formulated execution plan, your research will be done with ease. So here are a few things to help get you started.
Determine the purpose of your research
To start your market research, the very first thing you need to do is determine its purpose. Why exactly do you need it for? Well, since you need it for your business plan, the bigger question is what do you need your Business Plan for? Is it for managing your internal or external business operations?
The purpose of your research will determine its scope, whether it be for managing your business or gaining investments. If you are looking to gain investments you will need to do as detailed research as possible to convince investors you are familiar with the market. You are more likely to get investments if you show that you are making well informed decisions that will result in a successful business.
Make a strategy
After deciding the purpose of your research, it is time to make a plan. Having a well formulated strategy is winning half the battle. You simply cannot proceed with your market research without having set up a straightforward and clear path to follow. This means knowing exactly what questions you need answering, what type of research to conduct, who is your target demographic and where to get your information from.
Choose the type of research
There are many types of Market Research for you to choose from, the most common ones being surveys, interviews, focus groups and observation. Consider your budget when making your decision, as some of these can be costly and time consuming. And of course, no matter the type of research you chose, prepare well for it. For example, think long and hard what questions you will be asking your customers in the interviews or surveys.
Create your customer personas
Find out who your customers are. For the benefit of your business plan you will need to know your target customers. Who is buying your products/services and why? What is driving their spending? What is their age group, gender, income, education level ect. Knowing all of this will help you make adjustments and set the right price for your products and services, or even help you predict future sales.
Choose your source of information
Collecting information directly from your customers is not the only way to learn about the market. Conducting interviews and getting first hand information from your customers would be considered primary information. On the other hand, secondary information is all of the data from public resources like libraries, government agencies, industry associations ets. The plus side of secondary information is that it is readily available and free, and very detailed specific information can be purchased from other sources as well.
Market research is definitely no walk in the park, there is a lot of work involved in gathering information and analysing it. You also have a lot to consider before you even begin your research. But if you have a good start the rest will fall into place. With a well conducted market research for your Business Plan, you will be one step closer to achieving your goals.
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