A lot of businesses are set up without the benefit of any research being done. An even higher proportion never revisit their research.
If someone asked you to invest in a business and they didn’t have any recent research to demonstrate why it’s such a good idea, would you write a cheque? I wouldn’t and I would expect bank managers to act the same.
In the same way if you are still reliant on research you did ten or 15 years ago, you are working with totally dated information. OK, running the business for that period of time means that you will have much of the relevant information but not in an organised fashion.
So for anyone starting a business, expanding into a new field or who has been trading for an extended period I strongly recommend this: do your research. Research could tell you that your idea needs a couple of small tweaks to make it really brilliant or that customers will pay more than you thought for your products when combined with your expertise. It’s worth every hour you spend on it.
Research always boils down to someone asking questions to strangers. For the small business, that usually means you, personally, asking, which is why a lot of businesses avoid it - it’s embarrassing. But it’s still vitally important. What’s more, doing it properly and professionally can open some doors for you in the process.
Desk research to start with
A good place to start is at a business library, perhaps attached to a college or university. Here, you should find a collection of recent Mintel reports covering a vast array of subjects. This business sector will have been covered recently and it will tell you basic national research information: age and sex of customers, social class, income, purchasing patterns, newspapers read, regional variations and so on.
You may already know most of this, but it’s useful to have it confirmed and you will probably learn something new.
Ask your suppliers
They should have up to date research and should be delighted to share it with you. That should include Intersport or Stag if you are a member.
Read this magazine in detail every month
Knowledge is power and a lot of retailers in all sectors ignore the knowledge that comes through the letterbox each month. Be ready to react with an email full of questions to brand owners which are featured.
Next contact other specialist magazines. The advertising department of a consumer magazine will have research available telling you about their readers, whom they will know very well. This is readily available via a phone call. Existing businesses in the sports world are another resource. If your trading area will be, for example, Kent, an established business trading in Oxfordshire will usually be happy to give you tips and information. A non-competitive local business - say a retailer selling a totally different product range - will happily share his hard won local knowledge. The small business community is mutually supportive, so buy into its experience with pub lunches for a couple of people.
Thus armed, you’re ready for the hard graft. From this initial information, you will know the broad categories your customers fall into and you will be able to define where they live in your area. Get yourself a clipboard, dress smartly and go and ask them some questions.
What do you want to know? Clearly this will vary from business to business, but here are some questions you might try. Do they buy sports goods? How often? Where do they normally buy? How many in their family? What age group do they fall into? How important is a local supplier? How important is price? Do they like promotions eg free draws? Which supermarket do they usually shop at? When do they normally buy sports goods? Do they prefer famous brands? You can add a similar number directly relevant to your business.
Important point: you are trying to find out what customers want, not shoe-horning them in to fit your plans.
Start by telling them your name, give them a business card, say that you’re planning to set up a business locally and your bank’s business advisor has strongly recommended you do some customer research (he will do). Would they mind answering questions for a few minutes? Some will still refuse, but most will be happy to help and one or two might say “Call me the minute you start”.
This good, old-fashioned shoe leather route might not work. To reach the young single male aged 18-30 (classic sports retail country) it would certainly be inefficient.
Instead, visit local sports clubs on training night. Players will happily spend five minutes ticking boxes on a short form if you offer them some beer from the jug you’ve bought in exchange.