Decide What Kind of Business to Start With Market Research

 Chelsea Lamb (Guest)     06-10-2022

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When you make the decision to start a small business, you might be flooded with ideas, or you might have none at all. Either way, choosing which concept to pursue will be a challenge, and you need to formulate a strategy for picking the right one. Rather than simply choosing one arbitrarily, you can use market research to make an informed decision. By studying business trends, you’ll be able to identify a concept that’s primed for success. These tips from Invent High will help you conduct effective research, apply it to your new business, and become an entrepreneur.

A business that thrives in the heart of Chicago might not be viable in Kansas City. Business, like real estate, is all about location. For this reason, you need to conduct research on local business trends — those that are happening in your immediate area and neighborhood. To get started, look online to see if there are already any case studies or reports that you can draw on.

If there are, you can use the data in these documents to inform your trajectory. According to experts, location data can provide businesses with valuable insights. You want to decide what kind of business to start — so you want an idea that will be popular but not in a sector that’s already oversaturated. Take a look at the data in the report and see if it offers a breakdown of businesses in the area by category. This will help you see what sectors may have room for a new entry.

Of course, it’s likely that there won’t be any existing research on your area, and that’s okay. You can do your own market research by cruising around your town and making note of all the businesses you see. You can simply keep a tally of how many businesses there are in each category.

In addition to researching your local area, you’ll need to research your target demographic. You likely have an ideal customer in mind that you envision patronizing your business. You need to pinpoint exactly who this hypothetical customer is, why your business is best suited to serve them, and how you will market to them.

Conducting market research on your target customer will help you further narrow down what kind of business you want to start, too. Once you know who you want to serve, you can learn more about their needs and then strategize what kind of business would meet those needs. To research this, you can start by looking up consumer trends among your target clientele.

At this point, you should also be considering how your own skills and experience will play a role in your business. You don’t want to start a business in a field that you’re completely unfamiliar with. On the contrary, your market research should guide your path, but you should ultimately start a business based on your skills and abilities. Consider how much time you'll have to devote to your new business, too. However, if your skills do not fit the kind of business you want to start, you can look into going back to school to earn the right competencies. To break into the tech field, for example, an information systems degree will be highly beneficial. Explore online universities to see how you can manage getting an education while fulfilling your other responsibilities.

Determining what kind of business to start is one of the biggest decisions you may make in your entrepreneurial career. Luckily, though, there’s always room to pivot and adjust your plans in response to consumers’ needs. You can position your business for success by conducting thorough market research on your area and your target clientele.