In the past, common people were not yet aware of investing benefits for the future until finally, they realized that economic growth was rapidly increasing and have a great market potential for most business types. And even, it’s a little difficult to be offset by the income they have now. Therefore, many of them built businesses that might benefit them in the future. But businesses have been overspreading in the community. So, it takes specific strategies to be able to increase sales.
It’s almost impossible for us to build a business that will immediately earn a large income. Because everything in a business needs a process. There is even a term in the world of business that says; the future of your business is in the hands of your consumers. Even being aware that a business type has a great market potential in a certain area isn’t enough. If your customers aren’t satisfied with what they will get after buying and using your product or service, they will then give a bad review for your business which is detrimental to your business in the future. Yet, knowing how to analyze market potential is significantly useful in preparing your business strategies. But before we discover some points about market analysis, let’s we understand the market potential definition first.
Market Potential Definition
The definition of market potential refers to a measurement of a market which is useful to collect quantitative data regarding potential demand. This measurement includes a study of how many items would be bought in a specific market segment for a given period of time by assuming the use of appropriate marketing methods. In other words, the market potential is the biggest sales opportunity which is open to all sellers for a certain period of time in a specific market segment.
Market Potential Analyzing
You will need to perform sort of things how to analyze market potential such as;
One of the best ways for you to be able to find out the potential and condition of a particular market share is to make a demand approach. This method emphasizes human needs which up to now have not been fully fulfilled or maybe some have been fulfilled but the results are not satisfactory. For example, many people in rural areas need to go to the city for buying clothes. It can be interpreted that the village community might not get clothes according to their wish in that village nor finding clothes stores in their area. Through this approach and observation, we can conclude that the village is a good business opportunity to in the field of clothing business specifically to sell clothes that meet what they need and want. And it’s a good opportunity to raise the price a bit higher than what they can find in the city. This way you would be finding out the size of the market potential through getting to know demands made from the total needs, the number of consumers, and the target market.
There is a demand approach and there is also a bidding approach. In the bidding approach, it starts with the ability of an entrepreneur in producing products, providing services, and activities. This method you will start looking for markets that need your product or service. But first, you must understand the needs and trends that are prevailing in the community. Before doing a business, you should then know whether or not the purchasing power of your potential customers will be in line. And finding out whether or not they afford it. Then, find out the quality of your product with a product what would be the advantage of your business and so on. Those are sort of things that you need to do and understand the results correctly. This will then be used as a reference for developing your business. By doing a bidding approach, you will indirectly know the level of your competitors.
Observing the Most Frequently Desirable Needs
Before creating a product, you should make an observation of the most required needs by the consumers in a certain area. I could be daily needs such as groceries which certainly are the primary needs of the community. Besides the primary needs, there is still a seasonal need.
Analyze When They Need the Products
Knowing the right time when people need a certain product is also very important. Because if you sell a product when it’s not the right time, people will not be interested nor willing to buy. For example, you sell umbrellas in a summer season. Although there would be some people buy it but the sale will not be as good as during a rainy season.
Adjust Your Product
In this approach, you first need to find out what is the most employed profession in the area. In an agricultural area, then you might want to provide agriculture products. This way would make your business easily reach the target market and make profits quickly. If you are in a coastal area, you probably want to provide some products or services which are needed by fishermen there. Having your efforts to analyze market potential in those five approaches before starting a business leads to the best investment.