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General points

Once you have validated your idea (i.e. ascertained that the project is realistic and that the entrepreneur is suitable for the demands and restrictions of the project), it is time to go on to the next step in planning the project. This step involves careful attention to detail and the first thing to do is to carry out a study of your market. This will enable you, quickly and surely, to confirm, refine or change your first decisions regarding the 'product/market' pair; in other words, which product or service are you going to sell and to what sort of customer?

The label 'market study' may intimidate the business entrepreneur, who may worry that s/he does not have the expertise required to carry out such a study. In fact, even though there is some technical skill involved, a market study is above all a matter of common sense.
Without having any specialist concept of marketing techniques, you must (at the risk of not being able to sell sufficient quantities of your product and eventually being forced to file for bankruptcy) ask yourself the following questions and have a clear view of how to proceed, enabling you to find and to back up with solid facts , at each step, the answers to the following questions:


What are you going to sell?
(Why that product specifically, and not another? How can you be sure about what you are proposing?)
Make no definite statement unless you can back it up!


Who are your customers?
(Why them? What makes you so sure of this?)


How will you operate and how will you sell your product?
(Why this way and not another? How can you back that up?)


What is the forecast level of sales?
What makes you expect to meet this forecast level of turnover?
What evidence is there to prove that this is realistic and can be attained?


(area, site)
What are your reasons for thinking this is the ideal location, particularly if you are counting on a local customer base?

These are all obvious questions to ask, but you must be able to reply to each one, partly by using your common sense in the field , and find relevant answers that can be backed up with documentary evidence, careful observation, assessments, investigation and the advice of neutral parties who have the expertise necessary to discuss the subject.

Objectives of the market study

- to check that the anticipated market really exists (that there is a real identified demand to be satisfied, and that this demand is not currently being met or is badly catered to, that there are sufficient numbers of these future customers, that they can be reached easily and they have sufficient purchasing power),
- to assess the potential of this demand (future customers) and the potential turnover involved, both in terms of amount and in terms of how long it will take,
- to define in precise detail the product (or product range) or the service(s) offered,
- to fix the price of the product or service (or the type of range of articles offered),
- to choose the most suitable high-performance methods of attaining your projected turnover: the way in which you will sell your product, appropriate sales techniques, communications and distribution.

Principles of the market study

In many cases, it is feasible to carry out the study yourself.

Even if you do entrust it to a third party, for example to a 'Junior Entreprise,' (a student association based at the Business Schools, or 'grandes écoles') which offer very attractive prices, or to marketing professionals - details available through ADETEM (Association for the development of marketing techniques) - it is essential to take an active interest yourself so that you will be fully aware of all information regarding your market: this is of the utmost importance.

Proceed step-by-step and remain objective, prudent and pessimistic!

Meet your potential customers personally at every possible opportunity.

Show your future customers what it is you wish to sell (whenever possible: prototype, model, finished product, illustrated brochure presenting your services, etc.). Warning! - Do not forget to patent your idea, if necessary.

Assess the available information critically, bearing in mind that it may refer to activity on a much greater scale and therefore have no relevance for a small business project or it may be too general in contrast to a speciality.

Always check the 'freshness' of any information collected.

Compare several different sources of information on the same subject.

Continually update your knowledge of the target market.

Try to contact as many people as possible who have valuable knowledge pertaining to your project (having prepared essential questions beforehand): the head of a professional organisation, a technical assistant at the Chamber of Commerce, or the Chamber of Trade, or the Chamber of Agriculture, or other experts. For example, from the A.N.V.A.R. (the National R&D Agency), from the economic services of the Collectivités Territoriales (Territorial Authorities), future suppliers, competitors, etc.

Carry out a macro-economic overview of the proposed activity: national statistics, general market trends, etc.

- Research information databases at the INSEE (National Institute of statistics and economic surveys), which publishes all sorts of statistics, and at professional bodies, at the Office responsible for the sector at the relevant Ministry. Other resource centres: CECOD (the centre of studies on trade and distribution), INPI (the national industrial patents office), SESSI (the strategic studies and industrial statistics service), CREDOC (the centre for research and documentation on living conditions), etc.

Moreover, you should also focus your research on a micro-economic approach (i.e. one which focuses directly and specifically on the market targeted by the project: find information sources at the Regional offices of the INSEE, from the economic services of the Collectivités Territoriales(Territorial Authorities), market surveys of the area, on the spot observations, etc.).

Be selective as far as concerns the statistics gathered.

The information you are looking for should cover:

- The demand (the potential customers) who should be qualified and quantified with careful attention to detail
- The offer (direct and indirect competition) you must be fully aware of this and analyse it thoroughly
- The environment (professional, economic, legislative, sociological, scientific, etc.), in other words, all the factors which from a distance and on closer inspection may have a predictable effect on the development of the future activity (information sources: professional bodies, professional reviews, Ministries, local authorities, experts, documentation centres, for example those provided by the Chambers of Commerce, etc.).

Once you have gathered together all this information and analysed it, you should

- define precisely which products or services will be targeted at which categories of customer,
- determine how you can make yourself stand out from your competitors,
- work out the forecast sales figures,
- plan everything that needs to be implemented in order to meet these hypothetical figures.

There are 4 main categories of customer; for each one, part of the information-gathering process is different.

Categories of customer

The market study should be adapted according to the category of customer you are targeting, bearing in mind that a business may have an interest in one or more customer categories.

Identifiable customer
These include businesses, 'professionals,' and organisations with a particular statute that can be identified using database files: for example, all the hardware stores in Cher, all the electrical materials wholesalers in Aquitaine, all the Notaries in France, or the tourist offices, etc. These are available in a variety of forms (for example: professional directories, a selection of Chamber of Commerce files or from professional bodies, KOMPASS, France Télécom's P.A.P., the SIRENE file from the INSEE, telematic databases, trade shows, etc.).

For this type of customer, it is imperative that you meet a certain number of them in person (a panel) to find out their reactions to the product or service on offer.

This type of customer is a veritable godsend, since you can start to prospect for future customers while you are carrying out the market study and even record your first intended orders.

The hypothetical sales figures will be all the more realistic when based on such contacts (negotiations in progress, intentions to order, conditional orders).

Local customers
This means the potential customers of a retail outlet: those who live in the immediate vicinity, or who work there, or who have to pass that way (e.g. a shop near a train station).

You must therefore choose the trading area of your retail outlet with care, by observing the area in minute (key features of the area, headcount passers-by at different times of the day, a questionnaire to be completed by customers, etc.).

Assess the quality of life and wealth in this area, (The INSEE provides highly detailed statistics based on the most recent population census, the CECOD provides indexes showing consumer differences ) also study the competition already operating in the area and any possible losses to external competition (for example, depending on the circumstances: market stalls, mail-order companies, proximity to a big supermarket, etc.).

Location is all-important in opening a retail outlet: it is rare that you can change the normal route taken by passers-by.

Broad customer-base
This is the most difficult category to define. It involves cultural activities, fashion, tourism, hydrotherapy, the restaurant trade, the hotel industry, small, non-localised craft workers, etc.

Therefore, you need to research as closely as possible all information concerning the existing offer (the competition), current trends, lifestyles, fashion, trends, (professional bodies, experts, etc.).

You should contact the key influential media, the specialist press, opinion leaders and, depending on the circumstances, other retailers who sell related products.

The quantitative study of this customer base is no easy task, you must therefore cross-check general information, and the opinions of specialists and influential media with information obtained about the competition.

It is not possible to reach this customer-base in person, as it is, by definition, widespread. Once you have defined a customer profile, you can carry out a survey by giving a questionnaire to a panel composed of this 'customer-type' and paying close attention to the buying intentions revealed by the survey and how these may be of use in carrying out your project.

In general, growth in activities with this customer base is slow.

Mass market customers
This involves, on the scale of a very large market, the diffusion of consumer products through the intermediary of mass-market distribution networks.

An in-depth market study is necessary and requires the expertise of specialists in the field to carry out a study of consumer behaviour and incentives. The professional directory published by ADETEM (Association for the development of marketing techniques) can help in finding a specialist quickly and easily.

For setting up this type of business, the market study is a costly process and the commercial investments necessary are consequently very high.


Whatever the type of project.

- A market study, although not a precise science in itself, enables you to reduce uncertainties to a minimum. For this reason alone, it should on no account be ignored or rushed.
- The information gained from a market study is only valid for a particular moment in time.
- A study carried out at another time and place will never correspond exactly to another project.
- Do not hesitate to ask for advice from people who know the area and experienced professionals.
Do not forget that there are a number of qualified professionals who can be consulted free of charge.
- Whenever possible, the market study should be a pre-sales test.

Politica de confidentialitate



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