There are always those who think they can pick up and move to any of the dozens of empty towns across the United States. When should you expect dangerous weather? They’re wrong; most times, you’ll find a whole host of problems waiting for you if you attempt such a venture. If your business is going to thrive and succeed, it will require knowledge about the people in your area, as well as their needs. When you try to expand too quickly, without understanding these details beforehand, you’ll quickly learn that your business will be out of balance before too long.
1. Start your business with a CLIMATE analysis
There are 28,000 towns and cities in the United States, but there aren’t 28,000 people to fill them. This article isn’t about population – or how many people or businesses you can capture in your market. It’s about understanding what climate exists in your area – the environment of opportunity where you’re operating. That will serve as the platform upon which you build a solid business that thrives on thorough preparation.
“What are your goals?”
There’s a process that we teach to business and professional leaders who want their organizations to stay relevant, profitable and competitive over time. It’s called “Competing by Defining Yourself”. It’s an approach to business that lives and dies by a process of knowledge gathering, analysis and strategic planning.
In this example, we’re focusing on the small business owner who is concerned about their company’s long-term vitality. What are their goals?
The first step is to determine what climate your area has.
2. Determine what problem(s) exists in your area
The next step is contemplating the different problems – or opportunities – in your town or city area that are ripe for being solved by a new business venture. For an every-day example, perhaps we could consider how we manage our time differently in one part of the state than another. “What goods and services does your climate need?”
The next step, which can be included at any time during the analysis, is to consider all of the different products or services that might create a market demand for your business. Use your imagination; the opportunity is there.
3. Identify a market-sized market
Now it’s time to begin creating an inventory of potential customers who would purchase products or services from you. Will you be selling to individuals as well as businesses? Put together a list – any kind of list that helps you remember what people want from their lives, whether it be beauty salons, car dealerships or pet shops. “What do they want?”
4. Determine how to fill those needs
This step can be relatively easy when you walk through the steps. But if it becomes difficult, remember that your business will survive and thrive in a market that you help people fill with solutions of need or desire. Now, as your brainstorming develops, you’re beginning to understand what makes your town or city tick; and that understanding can only help your business anticipate customer wants and needs which will lead to a greater level of success than if you were acting on blind faith alone. “How can we help people?”
5. Understand the standards of your climate
The world is divided into different societies, with their own common sense and cultural standards. Your area presents unique opportunities and challenges. It’s your job to learn what those opportunities are. Customize the products and services you offer to fit your community’s standards, customs and preferred behaviors.
6. Develop ways to make contact with your potential customers
There are only so many times you can knock on doors before people start considering you a door-to-door salesman. When we pick up the phone and call someone for our business, it’s with the expectation that we’re going to do business with them. What better way to learn what people need than to get out there and find out directly? “How can we reach these people?”
7. Understand how they want to be reached
There’s a wide variety of opportunities available when it comes to reaching your customers. Some people will prefer email, some will prefer social media, some will prefer direct mail or phone calls from their mobile phones. Not all markets are created equal; collect information from those in your area about what matters most to them in terms of marketing contact with your product or service.
8. Develop your marketing strategy
Having collected your data from those you’ve met and who represent potential customers, you can now begin to develop a way you want to reach them. Social media is the most popular way for local businesses to connect with their customers these days. Many people are now using Facebook, Twitter, LinkedIn, Pinterest and other social platforms to advertise their business. Next time you’re driving through town, keep an eye out for billboards for local businesses or other news that might be helpful in helping you learn about how people in your area are choosing to be reached with information about new products or services. “What ways can we use?”
This exercise attempts to teach small business owners the power of understanding their climate. A good business plan is a combination of skills, resources and timing. Business advice from the National Small Business Association states “before you start your venture, you should define your business goals and objectives, study the industry in which you want to operate and examine your marketing strategy.”
Competing by Defining Yourself is a simple process that does all of that for you. It’s not about market share – it’s about margin share , or how much profit you can make in any market at any time. The more you know about what makes your local climate tick, the more appropriate products and services can be developed.