Know Your Market
Before you decide to start any retail business, you must know what the market is for your specific type of business.
Generally when a person decides to open a retail business it is because they have observed a need for a certain type of product in their neighborhood. To get the precise amount of knowledge to be successful, you will need to do your research. Part of this research is in knowing what the market is like.
You will obviously want to know what the consumer demand is. That just means you will want to know what the consumers need so that you can provide it to them. You certainly don’t want to open a store in an area that already has 12 just like it because then you are lessening your chances of success.
80% of new retail businesses will fail within their first year of business.
You certainly do not want to be a statistic. Naturally, choosing the right market to start your business in is just the first step in choosing the right retail outlet to invest your time and money in. You will also want to know what your competition is.
In order for you to properly assess your potential market you will want to do your research.
Here are some of the popular ways that companies use to gather critical information.
Surveys
Companies will often use market research surveys when they want to test the market with their customers. You can conduct question and answer periods with consumers, written surveys that ask your consumers what they want and how they would like to receive it; you can conduct hidden surveys, which is where your consumers do not know that they are being monitored.
Surveys are a very popular method that companies use to get consumer opinions. They are also used in order to get a consumer’s opinion about their competition’s products and services also. When you conduct a survey it is good to offer some sort of incentive or gift from the people that are volunteering their time. You can get a better response that way.
Product Testing
Product testing takes place when one company offers their product against another company so that they can attempt to convince consumers that theirs is better. Of course it would serve you best to advertise the results if they are positive.
Product testing is also a way for a new company to learn what is wrong with their merchandise before it reaches the market. It is a good way to get the general opinion of your potential consumer before you officially open for business. It helps get the “kinks” out first.
Offering A Pre-opening
This is a lot like hosting a sneak preview to a movie. This is where you can invite a select number of people into your retail outlet so that they can catch a glimpse of what you are hoping to accomplish.
You must understand that this is not the same as actually letting people into your leased property. This is more of allowing them to see what your idea is and offering a look at it in its expected reality. To do this, you would have to project a video replication of your store’s concept. This gives potential consumers a chance to see your idea before them, without you having to spend all of the money that it takes to begin a business first.
This is becoming a popular way for people to get an idea of their business as well as for you to get the consumer’s reaction to your idea without having to make it a full realization first. You can also make a computer generated CD-ROM and give your presentation to consumers to take home.