Section Seven: Markets

Purpose

The identification and subsequent entry into your markets should be solidly supported by market research.

This section of your business plan should be based on your market research. Review your research and use it to support your choice of markets that you’re planning to enter.

Guidelines

Use the questions in Table 12 as guidelines when reviewing your market research. These should help you summarize your markets.

Table 12: Guidelines for Markets Section

Guidelines for Markets
  • Does a market exist for your products and/or services? If so, describe the market, including your key competitors.
  • If the market is new, how do you know whether your products/services will be successful?
  • What market (industry) trends have you identified? Does your research support this direction?
  • What organizations or associations exist that will contribute relevant information and business networks for your new venture?

Example

Table 13 gives the example for the Markets section of Fay’s Variety’s business plan.

Table 13: Markets for Fay’s Variety

MARKETS

Fay’s Variety’s posture regarding clientele and markets is reasonably straightforward. Due to the nature of the business, market scope is limited primarily to Anywheretown with outside exposure to people working in Anywheretown, but residing elsewhere.

Clientele

Based on a marketing survey (Appendix I) conducted in 200x, the following was determined:

  1. Peak periods for weekend shopping are May, June, July and August.
  2. Price rated as most important, followed by quality and service.
  3. Sixty-four percent (64%) of local residents buy groceries in Anywheretown with a very high ratio (24%) purchasing baked goods.
  4. A large percentage of residents who shop out-of-town do so based on selection, with price second.
  5. Peak days for video rentals are Thursday, Friday, Saturday and Sunday.

The marketing survey results would suggest the following strategy:

  1. Implement an aggressive advertising and promotions/specials during peak times.
  2. Ensure that price is best in town along with targeted promotions.
  3. Target advertising to local residents with aggressive emphasis on bakery, i.e. signs on outside of building.
  4. Review selection of products and/or services offered and widen selection.

The fact that Fay’s Variety is downtown is excellent from the perspective that many residents also require the services of the bank, hardware, pharmacy, etc. located in the same area.

The market for Fay’s Variety for the most part is limited to a reasonable driving/walking distance to the store. However, we know that the local economy depends, to a great extent, on a transient market including tourists and working non-residents.

Emphasis to attract a broader market will include strategic advertising and/or signage to attract people into the store. Targeted specials will be considered, for example, salads, fresh baked goods, sandwiches, loaves of fresh bread. The convenience of additional services available inside the store (shoe repair, DVD’s, postage) will be highlighted.

A program to enlarge the market will be developed to reach out to associations and seniors.

The Tourism Anywheretown Task Force has been working along with City Council to promote the local economy. Wider coverage of advertising to places across the city is being used to pull in a wider customer base.

Click on Worksheet 8.6 to identify your markets.

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