Researching Your Market

5. The Competition

5.1 Check out what your competitors offer.

• Try the competition's products or services. It is the easiest way of understanding the market and what you will face when you become part of it. Carrying out a detailed analysis of their strengths and weaknesses will give you an idea of what you can do to establish a niche in the market.
• Look at the potential the competition has to improve its service or upgrade its product. Work out how you can stay one step ahead.

5.2 Consider if the demand for the product or service will change over time.

• Selling a must-have product cheaply might be a success, but if it has a long lifespan then customers will not return frequently enough.
• Make sure customers have a need to keep coming back - this could be because the product has been updated, the old one has run out or worn out or because it is so good they want more.
• Could the market be affected by external factors, such as the economy or legislation? Are there any protective measures you could put in place?
• Look ahead to possible problems; you may be able to develop your product to a wider selection of markets to increase chances of survival.

5.3 Your research will have given you an idea of how many potential customers there are.