Feasibility-Marketability-Profitability-Scalability-Sustainability. Before you start your business plan, you should make sure your idea is sound and that there is a market for your goods or services. Market research will tell you if there’s an opportunity to turn your idea into a successful business. It is a thorough assessment of a potential market. You must examine the size of the market both in volume and in value, the various customer segments and buying patterns, the competition, and the economic environment including potential barriers to entry and regulations that may affect the business. You will use this information to determine if your idea is feasible, and it will help you find a competitive advantage for your business. Here is a brief explanation about what is involved. More details are available in the business plan portal.
Target Market – Your target market is your potential customers. If you are opening a hair salon, you can either be a generalist or decide to focus on the high end or the lower end of the market. This section is relevant when your market has clear segments with different drivers of demand. In a salon, value for the money spent would be one of the drivers of the lower end market whereas exclusivity and prestige would drive the high end.
Market Need – Accurately determining the need for your goods or services is important and your investors, even if it is just you, must have a solid working knowledge of your market. You must know your potential customers and why they will buy from you. Here you need to get into the details of the drivers of demand for your product or services. This section is also where you need to place your competitive edge without mentioning it explicitly. In the following sections of your business plan you are going to talk about your competition and their strengths, weaknesses and market positioning before reaching the strategy section in which you’ll explain your own market positioning. What you want to do is prepare the reader to embrace your positioning and invest in your company.