But starting a business and successfully sustaining a business are two different things as Forbes tells us one out of five fail in the first year and after five years, only one out of two is left standing. Why do some businesses thrive while others dive?
First Things First: Extensive Market Research
The most successful businesses started with a clear vision, a concrete plan, and a coordinated effort based on a wide range and depth of market research that enables owners to discern the most important things to consider when starting a business. They asked the right questions, received the best answers, and charged ahead.
Questions that get to the root of what the most appealing services or products are: where customers are, who else is offering that solution, and more. Fortunately, in today’s data-intensive age, there is no lack of resources, from government websites like the U.S. Bureau of Labor Statistics to business development platforms to an endless array of subject matter experts.
Effective market research for small business insights is essential.
Here are some vital questions you should start with:
1. WHAT is the Need?
Simply put, a business is a problem-answering enterprise. It’s the vehicle that provides an answer to a customer’s need or question. The product or service you provide—whether it’s a home service business that improves your interiors or beautifies your exteriors—satisfies an essential need people face.
How do you identify those needs? Market research will help you clarify the specific pain points in the area you offer your product or service. A general overview of your geographic and demographic makeup of your planned service area will also help you discover critical untapped needs. Your gut instinct also helps. What needs do you feel are unmet? Others are probably thinking the same thing.
2. HOW Will You Satisfy the Need?
Recognizing a need, and finding a tangible, workable, profitable solution are two different things. While market research informs you of the overall need, creating a solution is about looking at the more granular picture—the specific and clearly defined answer to that need—
and delivering the greatest value to customers.
Your market research tells you the specifics, but only you know the finer, more focused vision of what answer you can offer customers. First and foremost, beyond all the facts and figures, you need to know what you are offering and why it’s important. This will be instrumental in everything you do: from training your staff to marketing your services to satisfying your customers.
3. WHERE is Your Competition?
Every business faces competition. Depending on the industry, your business competitors could be larger businesses with big staff offering a wide range of services or smaller businesses with a few employees offering a single solution.
Knowing your competition is as important as knowing yourself. They run hand in hand, because you know your uniqueness and differentiating assets best when compared to other available solutions. The better you know your competitors, the better you’ll know how you can improve what you offer.
4. WHO is Your Audience?
Knowing your competition is important, but knowing your customer is critical. Being fully aware of who you are servicing will tell you what you should offer them, how you should offer it, when you should offer it, where you should offer it, and why.
It’s been said that business is people and running an effective one has a lot to do with your communication and interpersonal skills. Having a concrete, well-defined idea of who your ideal customer is will help you identify them, fulfill their needs, and know how to interact with them now and in the future.
5. WHY is Your Solution Best?
The main reason some businesses triumph while others tank is that the solution the successful businesses offer is the most defined, highest value, most satisfying solution to customer needs. They have the best answer.
Business is personal, and in your business, you are the most important and defining part of its operation. The way you interact with others, your character, your vision, and your goals are in every hire you make, every product you offer, and every encounter you have. Your unique character and way of doing business are what most sets you apart.
Neighborly® Can Help
Knowing what to consider when starting a business and what makes a small business successful can be overwhelming. Fortunately, you don’t have to do it alone. Neighborly has helped hundreds of people discover unique franchise opportunities perfectly suited for them, making their business ownership goals a reality. We can help you too. And we offer the advantage of having proven brands so you don’t have to start from scratch.
There’s never been a better time to invest in your own home service business. Reach out to us today and we’ll put you in touch with one of our franchise consultants to help you find the franchise opportunity that’s right for you.