The success or failure of a new business venture hinges on so many factors, one of which is a market assessment. This becomes even more important when expanding into a new territory or launching a product for the first time.
While assessing a market involves a meticulous and careful consideration of the different aspects of the environment, it shouldn’t be anything more difficult than that. In fact, properly assessing a market involves asking the right questions and getting feedback.
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In today's post, Mr. Sami Raja, the Managing Director of Saja Consultancy will be going over the 7 important questions to ask when assessing a new market.
1. What is the current size of the market? This answering this question will help you to gauge if the market is big enough to accommodate you and the existing competitors. Or whether the market is too small for the stress and capital involvement of establishing a new business, depending on your type of business.
2. Are there possibilities for growth or contraction? Apart from measuring the current size of the market, having a clear idea of what the market might look like in the near future is also very important. If the market is small but has a potential for growth, it may be a good idea to enter and grow with the market. on the contrary, a market with the potential to dwindle is a no-go. In answering this question, it is important to look beyond the potential customer reach. Another important factor is the look at how the entire economy is faring.
3. Is Our Product/Service a good fit for the market? You may have an amazing product but it will not be suitable for every market. Maybe because of existing government policies or due to the buying behavior of your supposed customers. When answering this question, you should also consider the income level of buyers in the new market and how your pricing strategy fits into their budget.
4. Who are our competitors in the Market? Most entrepreneurs tend to focus on this aspect of market assessment, neglecting other important factors. Yes, this factor is important but without getting the other factors right, you will jump blindly.
That said, when it comes to evaluating the competitors, you should look beyond identifying their business names. In answering this question, look at their market share, their strength, the unique selling points, and their weaknesses. having the answers to these questions will help you to determine whether there is a place for you in the market.
But even more importantly, this will help you create a product that will beat what is already in the market.
5. How Much of the Market Share can We capture? Now that you have look at the current size of the market and future predictions. Another important factor to consider is the size of the market that you can "conservatively" capture. Even if the market is huge, it is important to be realistic with the market share that you can capture. This shouldn't be based on guesswork. A figure should only be reached after careful, technology-driven assessment carried out by an expert. A lot of business owners toy with this part and that is why we have multiple cases of business failure every year.
To help tackle this menace, Sami Raja Consultancy recently introduced a market assessment service to assist entrepreneurs and business owners seeking to enter the UAE market.
About Sami Raja
Sami Raja is a serial entrepreneur with global corporate management experience in challenging and emerging markets. A renowned consultant, he is the Founder and CEO of Sami Raja Consultancy, a Dubai-based business consulting firm specialized company formation, tax management, business restructuring, and marketing.