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Small Business: Research Your Industry

The importance of industry research for your small business.

Now that you have a great idea for your small business and have considered your competition as well as your customers, what is your next step? The next bit of information you must collect about your small business is to define which industry category it would fall within. Knowing the various aspects of the industry with which your small business falls, will help you to be able to price your products more appropriately, keep up with industry trends, structure your business, and allows you to keep an eye on your competition.

Usually the nature of what you do will determine the specific industry which you are in. There are some small businesses that overlap several industries, however. You should then try to keep informed of trends and businesses in both industries. Some of the industries which include small businesses as well as huge, multinational corporations include:

Manufacturing:

Small businesses may have difficulty competing with large, established factories to produce high volumes of goods at competitive prices. Most new manufacturing businesses focus on providing for smaller markets or design a prototype, and then arrange for a larger manufacturer to mass-produce it. Small business manufacturing usually involves specialized production on a small scale. Examples may include jewelry, pottery, custom furniture, and home and personal accessories.

Distribution:

Small businesses that focus on selling hard-to-find items in stores or on the Internet may be an excellent business opportunity. Print, direct-mail and online marketing, advertising, and order processing can extend your market globally. Fulfillment, which includes handling inventories, as well as packaging and sending out orders, is the main function of distribution.

Some small businesses sell a company’s goods through home parties, catalogs and trunk shows. Usually, you invest a small amount of money for merchandise samples, take orders, collect money, and send in an order to the manufacturer. They then distribute the goods to your customers. Many corporations which utilize this form of direct sales provide greater rewards to individuals who recruit other people to be sales representatives. If you are not interested in recruiting others you may have to settle for a smaller level of small business income.

Professional services:

Many small businesses are focused on selling or providing professional services to individuals or other businesses. Some initially begin providing services from a home office. Personal computers, fax machines, cell phones and various Internet technologies, are providing many small businesses the ability to easily expand their scope of operations. These technologies allow you to have the opportunity to have clients from various parts of the country, discuss projects over the phone or through e-mail, and transmit the work over the Internet.

Many contemporary small businesses conduct services only at client sites or on the road. These professionals may include commercial and residential real estate brokers, advertising and marketing sales representatives and sales representatives for manufacturing companies.

Some small businesses such as construction companies, and landscaping and cleaning services, may be a little more difficult to establish in that you may have to transport bulky supplies and materials which may also be more difficult to store securely.

Over all, you need to research the industry in which your small business would provide products or services, and decide if it would be a viable option given your circumstances, and whether there would be future opportunity for your small business to expand and grow. Doing your industry research will continue to provide the foundation for deciding whether your business may truly be a viable opportunity prior to investing significant time and money.

Information from Barnes & Noble Basics: Starting a Business

Web page and Start Your Own Business Course by Paul Susic MA Licensed Psychologist Ph.D. Candidate CEO/President Susic Psychologic Consulting P.C.

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