Assessing the viability of business ideas Business management 2B – chapter 4

Step 1 – who are our customers? Who are our customers and what are their needs? This entails a needs analysis

What does each feature offer the customer? Needs analysis What are the features? What does each feature offer the customer? Who is in the market already?

Who are the possible customers? Group them according to criteria Customer profile Who are the possible customers? Group them according to criteria What do we know about them? Age, income, lifestyle etc

Market segmentation Geographic – by area Demographic – by income, sex, age, education, race etc Benefit – by benefit the will receive Psychographic – by specific lifestyle or consumer status

Step 2 – mission statement and objectives Define the mission Set SMART objectives See page 41 for example

Step 3 – calculate the market share Who is your target market? Total market potential – Competitors share = Target market Do a SWOT analysis What can the market absorb? What is already being sold Difference is your potential (maximum) market share