Now that you’ve described your business and have a good idea of the goods and/or services you’re going to be providing–and a good idea of the location or territory where the business will be–it’s time to analyze that market to see if it’s the right one for you.
This is called “Market Analysis.” You need to find a place with customers that will be a good fit with your business.
For instance, maybe downtown Vallejo is a good place for a breakfast and lunch restaurant because there are a lot of government workers over at the city hall, library and post office. But maybe a nighttime restaurant won’t work because it’s kind of a seedy, empty place at night.
Another example is locating a feed store in St. Helena. There are vineyards all around but no farms with animals. There aren’t very many horses around either. So St. Helena would be a great place for tourist restaurants, bed-and-breakfast inns, or viticulture supply stores, but it’s a lousy place for a feed store.
Use the Demographics links at the Napa Chamber of Commerce website or the information you can find by zip code at City-data.com. Both sites are linked in the Useful Links area.
Write your marketing analysis in paragraph form, but don’t hesitate to do a numbered list of facts and figures that demonstrate the demographics, geographics and psychographics of your target market. If you’ve forgotten these concepts, look them up in the early chapters of our textbook. We studied them very carefully in the beginning of the school year.
The business plan on p. 640 calls it “Trading area analysis.” That’s E. in the outline. It says to include geographic, demographic, and economic data, as well as information about competition. It’s important to describe your competition and explain why you can succeed in that market in that location
Make your “Market Analysis” as long as it needs to be to fully explain your research, but don’t make it longer than it needs to be.
Good luck.
