Having identified your product or service, and who you want to it sell to, it is important to be aware of any factors that might impact on the success of your business, both positively and negatively; opportunities and threats. These are things that are outside of your control such as legal changes, technological changes and social changes.
- Is demand for your product or service growing or shrinking?
- How could customer requirements and buying behaviour change in the future?
- What new products are in your competitor’s pipeline – could they make yours look outdated?
- How competitors are changing – what are their plans?
- What do competitors offer and what prices do they charge?
- How do your competitors advertise and promote themselves?
- Is there any forthcoming legislation which could affect your market?
It is also useful to consider your own strengths and weaknesses, things that you do have control over. Enthusiastic employees are likely to be a strength to your business. Limited financial resources may be a weakness. What are your strengths? Can you make more of your strengths and reduce your weaknesses?
This sort of analysis, often referred to as a SWOT analysis, is critical to the ongoing success of your business.