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What You Must Know To Do Your Own Market Analysis

Know your product. What need will it satisfy? How does it compare to the competition? Is it priced fairly? Your marketing strategy should work to disclose customers’ problems and areas of dissatisfaction that can be easily remedied. This process will help identify opportunities for new products and services.

Try to determine the quality and quantity of your market segment. For example, in the retail business, it would be helpful to know the aver- age income of the people in your selling area to predict spending levels and to estimate how many people are potential customers. Use the following resources to help you:

  • Census Bureau:
    Statistical information on population, age, education and income demographics
    www. census.gov
  • Colorado Department of Labor & Employment:
    Industry and labor market statistics
    www.colorado.gov/cdle
  • Department of Local Affairs State Data Center:
    Useful demographic information
    https://demography.dola.colorado.gov/

Determine the proper location for your business. Gather information about traffic patterns (vehicular and pedestrian) to assess sales potential. The Colorado Department of Transportation (CDOT), Division of Transportation Planning, 4201 E. Arkansas Ave., Denver, CO 80222, www.dot.state.co.us/ has information on vehicular movement on state highways. Some local governments have similar information for city and county roads. In addition, you should observe pedestrian movement during business hours to estimate the amount of walk-in traffic your business might receive.

Market research should identify trends that may affect your sales and profitability. Population shifts, legal developments and local economic conditions must be monitored to identify problems and opportunities. Competitors’ activities should be monitored. Check the local Yellow Pages to locate your major competitors. What strategies are they using successfully or unsuccessfully? Are you prepared to take advantage of a competitor leaving the market or respond to a new competitor entering the market? Do comparison price shopping, be competitive and still profitable.

Conducting A Market Study

If you want to hire someone to conduct your research, private firms offer full or partial services and will perform an extensive market study including design, administration and analysis. Fees will vary depending upon the study. Refer to the Choosing Advisors chapter of this guide.

If you want to do your own research, the following list of contacts and agencies can serve as a general guide to sources offering market research information at little or no cost. In addition, refer to the Sources of Assistance chapter of this guide.

US Department of Commerce/Census Bureau: Offers statistical profiles of an area and general social and economic demographics such as population composition, age, income, education and industry of employed persons. A library is on the premises for research at 6900 W. Jefferson Ave. Suite 100, Lakewood, CO 80235. Visit www.census.gov.

Colorado Department of Labor and Employment/ Labor Market Information: This department’s Labor Market Information Section provides demographic breakdowns and publishes a “Colorado Labor Market Information Directory” and an “Annual Planning Information Report” covering state and local labor market areas. For more information, contact the Labor Market Information Section at 1515 Arapahoe St., Tower II, Suite 300, Denver, CO 80202. Visit www. colmigateway.com

Trade Associations: Trade Associations maybe useful to help you find out the number of similar merchants in your market area. Members who are currently in the market may also assist you with information to get started. You can find listings in the reference section of the public library in the “Encyclopedia of Associations.” While at the library, feel free to ask the reference librarian how to access this publication online.

Public Libraries: The Denver Public Library’s Business Reference Center is the most extensive in the state. The library provides access and assistance to help you research more than 1 million publications by federal, state and lo-cal government agencies and also has a business periodicals index. The larger suburban branches in the Denver metro area tend to possess better business collections than smaller branches. Inter-library loans to share resources are also available statewide. The Denver Public Library/ Business Reference Center is located at 10 W. 14th Ave. Pkwy, 4th Floor, Denver, CO 80204. Visit www.denverlibrary.org

Universities and Colleges: Business school departments may offer student market studies for no charge, yet professors may charge a modest fee. Also, extensive library collections may be available for public use. For additional sources of marketing assistance, refer to the Sources of Assistance chapter of this guide.