Guest Post by Daniel Laing
Welcome to the first Wisdom on a Wednesday. The first topic that is being covered is market research. This will be a bit of a long post, but hopefully it provides value for you.
I have chosen market research first, as it is one of the first steps that you will do when deciding to launch your new business. As with market research, when done properly, helps you to decide if your business, property or strategy you are going to do is viable. Additionally doing something where the market doesn’t need or want it is the top reason why most startups fail.
This is due to the person not conducting enough market research and making a poor decision by not understanding the market they are going into. (A recent example would be Ronald Sims buying a money pit of a “castle”). If more thorough research was conducted, this basic error would have been avoided.
Step 1: Secondary Research
Secondary research is research that you have not conducted yourself. Secondary research is very cheap to conduct and not as time consuming as compared with primary research. When doing secondary research, you would use this to find out the size of the industry you are in, to work out if it is viable, but also for if it is oversaturated. (Deal Sourcers attending these courses, probably haven’t done enough research on this, which is how they are making this unwise decision, hopefully this helps them.) Watching videos would also count as secondary research.
In property your secondary research would be using sites such as Rightmove or Zoopla to find out housing prices. Or going on your local council website to learn about licensing requirements. Another part of secondary research is doing a competitor analysis.
If you wanted to find out more information on the local area this site is useful.
Once enough secondary research has been done, you would move onto Step 2.
Step 2: Primary Research
Primary Research is research you have conducted yourself. This is more expensive and time consuming than secondary research. Examples of this would be conducting questionnaires or focus groups. In property primary research would be doing property viewings or visiting the area and notg down the demographics. But also visiting at different times to learn if it is busy or not.
Once They have been conducted you would move on to Step 3.
Step 3: S.W.O.T analysis
S.W.O.T. stands for Strengths, Weaknesses, Opportunities and Threats. You would do this on yourself, business partner, your business and your competitors. This is to give you an understanding of if their are any gaps where you have an advantage, or where you need to improve upon and possibly hire.
Hopefully this has been helpful to you and given you a bit of added value, if you have any questions or that you need a bit of help with this, feel free to comment below in this thread.
This article first appeared here on 9th September 2020.