How do I do market research for a business? (sales, licenses, agent)

[Ron.]

I know what kind of service business I want to start, I just want to do market research to confirm that the service is needed in my area( also whithin a 2 mile radius of where I live). The business is a business brokerage business. Basically a business broker is like a real estate agent, but instead of selling real estate we sell businesses. Also, business brokerage is a business that can be started from home so I won't need any outside office space or anything like that.


Any advice would be great..........

[Mircea]

Originally Posted by ChicagoRon

I know what kind of service business I want to start, I just want to do market research to confirm that the service is needed in my area( also whithin a 2 mile radius of where I live). The business is a business brokerage business. Basically a business broker is like a real estate agent, but instead of selling real estate we sell businesses. Also, business brokerage is a business that can be started from home so I won't need any outside office space or anything like that.


Any advice would be great..........

Do you have a business plan? What is your direct and indirect competition? Those might be some sources of data for you.

You might try your Secretary of State, or whichever department you state has that grants business licenses or registers foreign and domestic corporations and businesses. You might be able to search by address on their database.

You might want to try your the Cook County Recorder/Auditor who has tract/lot info, and you can search by address, problem is what if the business leases the property?

Try your local Chamber of Commerce, Better Business Bureau, Kiwanis or Rotary Club for info also.

If it is industry specific, like say restaurants only, check with the local restaurant association.

[allforcats]

You also might want to take a course or two at your local university, college or community college. They have instructors who actually know how to do this blindfolded, and will inform you of everything you need to know and also prepare you for what the inevitable ups and downs can be. Worth considering letting someone show you the successful way, rather than reinventing the wheel?

[Ron.]

Thanks to all that responded! Great answers.

[UpperPeninsulaRon]

Originally Posted by ChicagoRon

I know what kind of service business I want to start, I just want to do market research to confirm that the service is needed in my area( also whithin a 2 mile radius of where I live). The business is a business brokerage business. Basically a business broker is like a real estate agent, but instead of selling real estate we sell businesses. Also, business brokerage is a business that can be started from home so I won't need any outside office space or anything like that.


Any advice would be great..........

Do you want to help put a value on a business or just handle the paperwork once a price has been established? If you want to do the former, you will need a pretty strong background in Accounting and Finance. Business valuation will usually start with the financial statements and then restate them to reflect things like owner's salary versus what a manager might be charged to run the business, inventory, etc.

Then you usually triangulate using several established methods (there are some great reference texts on the subject) and derive a figure. Once a price is established, then the fun part starts, working on the terms and conditions alternatives.

Good Luck.

[Ron.]

UPR, I am well aware of HOW TO perform the tasks for the business I want to start and I most certainly have a background in Accting and Finance. I want to know how to do market research.


Thanks for you answer.

Originally Posted by UpperPeninsulaRon

Do you want to help put a value on a business or just handle the paperwork once a price has been established? If you want to do the former, you will need a pretty strong background in Accounting and Finance. Business valuation will usually start with the financial statements and then restate them to reflect things like owner's salary versus what a manager might be charged to run the business, inventory, etc.

Then you usually triangulate using several established methods (there are some great reference texts on the subject) and derive a figure. Once a price is established, then the fun part starts, working on the terms and conditions alternatives.

Good Luck.

[StealthRabbit]

Originally Posted by ChicagoRon

... I want to know how to do market research.

Dig, dig, dig... (be a sleuth)... And network. (be a social butterfly, attend functions that relate to this venture, talk with professors and commercial Real estate brokers)

Locally we have lots of Business brokers (restaurants most popular).

1) I'd call on local ads of businesses for sale and be an 'interested buyer', while establishing a network connection of business brokers, but don't abuse their time, be seriously interested and follow up for consideration. This also gives you visibility to their strengths and weaknesses. (anywhere from advertising to personal styles, and financial backgrounds)

2) Ask for recommendations from the broker of past sales. TALK to the previous clients.

3) look outside the box, and research fringe areas and business interests and look for overlap.

4) write your business plan

5) schedule time with local SCORE office, use their advice and resources.

6) Talk to market research companies and determine their procedures and contacts. (They often pay dearly for info, which you may be able to by a sub-portion)

7) spend serious time in the research library of a local university with strong marketing program, maybe team with some MBA students as a project.

I strongly recommend re-reading UPR's post, and considering what YOU can bring to the table that will give your new company a unique advantage. There are lots of opportunities, and this could be a good one.

Good luck.

[UpperPeninsulaRon]

Originally Posted by janb

Dig, dig, dig... (be a sleuth)... And network. (be a social butterfly, attend functions that relate to this venture, talk with professors and commercial Real estate brokers)

7) spend serious time in the research library of a local university with strong marketing program, maybe team with some MBA students as a project.

Good luck.

Join a local business networking group. These are usually comprised of business owners / managers and will travel in the circles that you want to travel in.

Take a good look at point 7 above. There is a ton of free research (even have the students work for you for free). Call the local business dean. Ask him / her to lunch.

Spend a lot of time with the Chamber of Commerce. Become known as a giver - donate time to things like being on New Business Ambasadors.

I know that people do not think of these things right away - they just want to get started. But, the more connections that you make, the better your business will be.

Look in a site called Reference USA. You can get all kinds of business information - owners names, number of people, etc. But be careful, a lot of it is wrong in precise terms but is directionally valuable.