2018 Recipe For Hope - Dr. Jerry Dean Epps - all rights reserved

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Market Research

Before Walmart or Sears puts a store in an area, they do Market Research—before they ever buy land or build a building, they learn how many POTENTIAL CUSTOMERS live in the area where they are thinking about building a store.  That is what you have to do.  You have to learn HOW MANY customers will use WHAT KIND of store.  Will 45 customers come into your little store each day, or 180?  Are there competitors nearby?  Is there a little store just 10 houses away from you?  If so, not so many customers will come to your store.  But if the next little store is a long way away, then you will have lots of customers.  How many are likely to come to your store?  THESE ARE VERY IMPORTANT QUESTIONS and you can not just say “I don’t know”.  You have to look up the information on the internet, if it is available there—or from municipal and other public records.  OR you have to walk around and count households.  You can do it either way—but you must get the numbers.

By the time you actually open the doors of your new micro business, we want to know it will be successful.  We cannot have you start the business and then learn whether or not it will be successful.  No, we have to know in advance (ahead of time) how many customers, all the costs, the estimated profit, etc.  Learn everything first, then you will have success—if you work hard and operate smart.
 

  1. How many people do you estimate DRIVE past your house each day?
     

  2. How many people WALK past your house each day?
     

  3. For example, if you had a little store, would people walk to it or would they drive to it, or both walk and drive?  Specify HOW MANY would do each.


It is a very important difference if there are 85 households in the community that would use a little store OR if there are 400 households in the community that would shop at the store.  AND, do very busy roads with fast traffic separate people from getting to your store, etc.?  OR, if it is something like batteries, people will come from farther away to buy specialty items—so that makes the “market area” larger.  How many households are there in this larger market area?  OR, perhaps we should ask, how many functioning cars are in that market area?  You have to know your market area very well.

What is the market potential for ordinary items (bread, cooking oil, batteries for flash light, ice cream, candy, etc.) and what is the market potential for specialty items like car batteries?

Series of Questions, each one leading to another.

 

  • How much money can I make?
     

  • How many people in my market area?  
     

  • How many of them are potential customers?  
     

  • With how many competitors so I have to share those customers?  
     

  • Will they buy one or many?  
     

  • How often will they buy?


Depending on what micro business you choose, you may have more than one market.
What expensive products will you be selling, what is the market area and numbers for them?
What mid-range products will you be selling, what is the market area and numbers for them?
What inexpensive products will you be selling, what is the market area and numbers for them? 

ADDITIONAL  MARKET  RESEARCH  QUESTIONS:

  1. Where will this business be located?    ( In your house?  If so, what room or part of room?  Are you in a location with a lot of foot traffic?  Car traffic?  Give us the particulars.)      
     

  2. Who will you promote to (give flyers to, tell about your business, etc.)?
     

  3. In relationship to your business, where are other similar businesses located?
     

  4. In relationship to your business, where are your potential clients located ( schools, offices, etc )?
     

  5. Approximately how many potential clients exist in the market where you want to start this business?

    (example: there are 2 high schools with approximately 500 students each, and 1 university with approximately 1,000 students,  and 3 office complexes with approximately 300 employees...etc)
     

  6. Can you get on radio free with a "Public Service Announcement"?  
     

  7. How many business will be near enough to you that your customers can go to your competition if they want to?
     

  8. What will you offer that your competition does not offer?    

    (This is about WHY will customers come to you and not to your competitors)
     

  9. Who is your “average” customer?      (Tell us their income, education level and residence location)  

    Related questions:
     

  10. Who will be there to serve customers? 
     

  11. How many hours a day will business be open?  


From the video course: “How To Start A Micro Business” by Dr. Jerry Dean Epps, Ph. D.