In part one of the planning section, we discussed sections of the business plan that you can write with relatively little research. There are more sections that can be done without research than I mentioned, but if you browse through the Business Plan Outline, you should be able to find them easily.

In this post, I’ve going to briefly outline the types of research you need to do to complete other sections of the business plan.

The primary area of the business plan that will require substantial research will be the Local Market Research and Analysis. In this section, you need to explain three things: Who is your target customer, what is your competition, and how big is your market? The difficult thing about this section is that each answer will inform another answer. You also have to remember what your original idea is and keep that in mind here.

The way I began was by contacting local agencies to get demographics. In South Carolina, we have a Department of Disabilities and Special needs, a Department of Mental Health, and an Office of Exceptional Children within our Department of Education. I contacted all of these agencies and got demographics for various groups within my geographic area. I also contacted the Budget and Control Board and got the numbers for population in my area, as well as average income by area. With these numbers, I was able to decide on an initial target population and build a profile of my target customer.

This seems like a lot of work for something that may seem like common sense, but when it comes to marketing, knowing as much as you can about your potential client will benefit you! Do you want to work with a certain population? Where can you find those people? What marketing do they pay attention to? Who do they respect in the community? By getting familiar with your future client, you’ll better be able to understand, work with them, and form a relationship.

Competition. We are a small field. Odds are, there aren’t too many of you in your area, but this doesn’t get you off the hook for this section. You need to verbalize in this section anyone within your radius that offers services similar services to yours that might be competing for clients with you. You’ll also need to analyze what they may offer that is comparable to you, better than you, or worse. What is their price? What services do they offer? Are they certified? Do they accept insurance? Do they travel? Do they have a clinic? Are they well established in the market? Questions like these need to be answered because they will help you structure your business so that you can co-exist in the market together. You might need to reconsider your pricing model, you might need to offer groups when you planned on only doing individuals, you might do none of these. All these decisions will help form your business.

In short, the best thing you can do for your new business is research. Know the people you’re going to be working with. Know the market. Know the needs. Know what people can afford and not afford. Know that you are going to be leaving a lot of voicemails with state agencies trying to get demographic numbers.

So the emotions of this stage are as follows:

Frustration. Stagnation. Momentum. Excitement. Depending on what stage you are at, you could be feeling any of these things. Someone may not be returning phone calls, you may not be sure where to get an answer you need, an appointment may not be until next week and you’re ready for it now. You should try to feel good about what you are doing through this process. It isn’t easy. It’s a big document, but it will help you maintain the form and idea of your business in the future. Keep it up! You are doing great!