Category Archives: Market Research

How to Find a Corporate Strategic Partner to Assist in Bringing Inventions to the Marketplace

Many entrepreneurs do not think about teaming up with a corporate strategic partner to fund their invention or idea and/or to bring it to the marketplace. Today, finding a corporate partner is one of the better ways to tap money sources. A corporate strategic partner can provide the capital resources, credit, management expertise, distribution channels, and/or manufacturing services necessary to successfully market your product or service. A corporate strategic alliance can provide needed funds for research, development, and marketing your product or service.

There are several advantages to partnering with large corporations. First, a corporate partner is usually willing to wait longer to receive a return on its investment than traditional lenders or investors such as bankers or venture capitalists. The return on the investment is not as important as the potential of establishing new divisions. If corporate partners are interested in taking an equity position in your business, you probably will give up less ownership than working with a venture capitalist.

Corporate partners can contribute more than capital to your business. They may offer good business advice and moral support and provide state-of-the-art technology. Establishing a corporate strategic alliance can also provide valuable contacts in the business and financial community.

The disadvantages of corporate strategic alliances include loss of control or the risk of the corporate partner making demands that you are opposed to. For example, you could be required to share your research results in exchange for use of its facilities. Also, your affiliation with one corporation may affect your ability to sell your product to its competitors. Or corporate mission and goals could change, causing your corporate partnership to sour.

To identify a potential corporate partner, look for corporations searching for complementary products to distribute through their existing channels. The key is to find a corporation with the resources but not the time, commitment, or creativity to pursue the product or service you provide. Remember, corporations are mainly interested in building and strengthening their basic business. Therefore, your output must fit their mission and goals.

Focus on corporations that are interested in early-stage ventures and have already invested in your industry. Also look for a corporation that might be interested in the right to license your invention.

An excellent resource for structuring corporate strategic alliances is Winning Combinations by James W. Botkin.

Small Business Increase Sales to Make Money: Do Market Analysis to Develop Effective Sales Growth Strategies

A small business represents a financial investment and to make money lots of things need to go right. Market analysis is the fundamental starting point as without understanding the competitive environment and customers there is no potential profit. Good market analysis will lead to a clear understanding of the customer and their buying patterns. Consequently, this will help to develop clear strategies, including sales strategies to improve your product or service to customers and to increase sales growth and make money.

Market Analysis

Comprehensive market analysis will help to determine the opportunity to increase sales growth and what barriers there may especially in the form of other competitors. Market analysis must perform two core goals:

  1. Define market opportunity in terms of size and customer segment
  2. Define competitive landscape

Tools such as SWOT analysis and Porter Five Forces model will be useful in this context.

General Sales Strategies

Sales strategies will usually focus on one of three core approaches:

  • New – introduction of a completely new product or product design or the latest and greatest version for example cars, electronics, mobile phones, etc.
  • Differentiation – establishing a brand that will typically command a higher price for example designer clothes and accessories, premium brand cars, etc.
  • Price – low cost or commodity pricing to reach a mass market for example budget airlines, etc.

Business Sales Strategy

To exploit the market opportunity the business needs to select the right sales strategy and try to build on business strengths – things that the business is very good at. For example, a small business may decide that their focus to increase sales should be on building a local brand based on excellent customer service, especially the after sales service. If existing staff are not good at providing this service then they need training to make this strategy work. This service approach would be very different to a stack-them-high-and-sell-them-cheap strategy. A business sales strategy must combine:

  • Market opportunity that can be exploited by the business in the face of existing competition
  • Business strengths that will reinforce the sales approach

Increase in Sales

The selected sales strategy needs to be targeted at the customer segment and exploit their buying patterns to increase sales growth and make money for example:

  • Unique selling point such as a new product with a stylish design, build quality or more exclusive
  • Seasonal influences such as greeting card based on time of year or specific anniversaries
  • Preferred channels such as retail outlet or internet
  • Sales incentives such as promotions, money back guarantees, after sales service

Ideally, feedback from customers will inform the sales strategy to allow the business to increase sales by giving the customer more of what they want.

Market Research for a New Small Business: Careful Market Analysis is the Key to Successful Business Plans

A good business plan is the foundation of success in starting a business; not only is it essential in winning the support of investors and lenders, but it also provides a roadmap for steering a new business through the critical early months.

Not all business ideas are good business ideas; if there are flaws in the basic concept, thorough market and business research will help to identify them, and possibly show how to overcome them. Even if the basic idea is a good one, lack of marketing research can deny it the success it deserves.

Although large businesses can afford to employ expensive market research agencies, this should not be necessary for a small business startup. This simple guide to the information you need and where to find it should help to carry out a successful DIY market analysis on which to base writing your business plan. Listed below are the questions your market research should answer:

The Business Sector

  • What is the overall market size and structure of the sector?
  • Who are the main operators or providers?
  • Who are likely to be your main competitors, geographically, in size, or in your particular niche?
  • What are their strengths and weaknesses and how can you capitalize on these?
  • What percentage of the sector can you realistically aim to capture?

The Customers, Clients or Users

  • Who are they, and where are they, by socioeconomic group, age and geographic location?
  • Who are your particular target customers or core customers?
  • What are they looking for in quality, price and accessibility?
  • Which advertising media are most likely to reach them?

The Product or Service

  • Does the product or service match the needs of the target customers?
  • How does it compare with competitors?
  • What is the unique selling point which will give your product the edge?

The Operating Location

This can have important implications for even internet centred businesses in respect of:

  • The availability and cost of staff and materials,
  • Storage and workspace.
  • Transport links.
  • Communications including telephone, broadband and mobile phone coverage.
  • Property costs, rentals and rateable values or other local taxes.

For conventional customer contact retail businesses location will generally be an overriding consideration, and you also need to consider:

  • Does the site have enough passing road and/or foot traffic to bring in opportunity customers.
  • Are the proposed premises appropriate and will they suitably impress/attract customers?
  • Are they easily accessible for customers in your target catchment area, including road, rail, sea and/or air transport facilities as appropriate to the business.
  • Car parking.

Legal Considerations

What is the impact of legislation on employment, health and safety, freedom of information and taxation on the business?

Financial Research

What are the start up and operating costs including:

  • Capital costs for premises, vehicles and equipment?
  • Materials and supplies?
  • Labour?
  • Heating and lighting?
  • Transport and distribution?
  • Communications IT and telephones?
  • Insurance and security?
  • Marketing and advertising?
  • Loan interest and bank charges?
  • Legal and accounting fees?
  • Tax liabilities, including, as appropriate, Corporation and Business Tax, Income Tax, National Insurance, VAT and Business Rates?

Where should your product be priced taking account of competitors’ prices and customer perceptions of value? What will be your profit margin? Based on these figures and your expected market share, what will be your cash flow for years 1-3? And the final and most important question resulting from all this- is the business financially viable?

Sources of Information

Much of the information you need will be readily available from Government and business association statistics, trade journals, company reports, the financial press and the local press, all of which can generally be found through the internet or public libraries, or by personal request from the organisation concerned.

Government business support agencies, like the UK’s BusinessLink can often provide information, or advise on where to find it.

Census data can be a useful starting point for demographic information, though this becomes increasingly unreliable over the 10 year interval between censuses. Government, and particularly local government, statistics may be more up to date. Personal observation and sampling of an area’s car and house quality, property costs and ownership and the clustering of other businesses can be very useful, but only to supplement soundly based factual statistics. Advertising departments of local newspapers, and estate agents often have useful information if you approach them in the right way.

Carrying out a self help customer survey can be particularly useful, and if the demographic profile of a particular area is especially important, you can buy off the peg post code analysis from market research companies or even Royal Mail at a reasonable price.

Finally, telephone directories and other advertising can tell you quite a lot about the competition.