market research is critical to business plan

Market research is the most important section of the business plan. Using what you learn, you position yourself in the marketplace by specifically defining what you will sell, to whom you will sell it, why they will pay you and not someone else, and whether you will earn enough to make it worthwhile.

The time and effort you spend in careful research will more than pay for itself in launching or running a business.

Start by relying on your own experience and training in your line of business. And, if you don't have any experience, gain some by working as a full-time, part-time or temporary employee.

Read newspapers, books and trade journals. Ask a reference librarian to assist you in finding information about your industry.

Attend trade shows and training seminars sponsored by your association.

When you are in other cities, talk with small-business owners in your industry. Because you will not be a direct competitor, many will be willing to share valuable information. Be aware, however, that their business climate may be different, so you may have to make adjustments. Their experience with sales trends, for instance, may not be applicable to your situation.

Conduct informal surveys of potential customers. Ask if they would be interested in your product or service. What would they be willing to pay? What's important to them in making buying decisions?

Learn as much as possible about your potential rivals. Visit their businesses and observe their operation. Purchase their products or services and evaluate them. Talk to their customers.

Talk to your potential suppliers. They have an interest in seeing that you succeed if you will be buying from them, so they normally are willing to provide useful information.
For local demographic and economic data, visit the offices of your local school district, chamber of commerce or economic development organization.

And don't forget the Internet, where there's much free information. For instance, gather national business statistics at www.bizstats.com and demographic data at www.census.gov. Visit your rivals' and customers' sites. Your public library card allows you access to the library's website and business databases for which you otherwise would have to pay.