Why research is the key to any business start-up

Any business start-up requires blood, sweat, tears and long hours of commitment. We all know that. But there is no point knocking yourself out on what you believe to be a winning idea without first doing one very important thing: research.

By research, this means researching a number of areas. You need to know all about the market you’re entering, your competitors and where you can fit into it.

Market research is a catch-all phrase that can be broken down into subsections. First of all, it means making sure there is a market for your product or service. Are people searching the web for what you offer or intend to offer? If you’re investing in bricks and mortar, is the footfall high enough to justify your position? When investigating the former, get yourself a free Google AdWords account and look into the search terms that people are using in your area to get an indication of demand. If setting up premises, simply count the number of people who pass in an hour or a day to get an idea of you potential customer base. These are both really simple exercises but invaluable in judging whether there is enough demand for your offering.

Secondly, market research is finding out who else is already trading in your market and how they are doing. There are free services out there that allow you to search Companies House direct, meaning that there is no excuse for not knowing the ins and outs of your competitors and their business. Sometimes called competitive intelligence, doing an assessment of your potential competitors through their freely available financial records and also through analysis of their website, products and services is essential to any start up.

The third part of your research is an extension of the first two. You know your potential customers and you know your potential competitors – now you need to work out exactly where you fit within the market. Doing some gap analysis of where competitors are failing to solve customers’ problems will allow you to find your initial niche. Always remember that although you may be in love with your original idea, you have to allow research to point you in the correct direction, even if it is not where you initially thought you would go. Research is no good if you do not act on what you learn from it.

Make research your mantra not only when setting up your business but also as you grow and develop – information is power and you need to make sure you have the most up-to-date and relevant research to hand at all times.