A Pass / Fail Test for Any New Market

If you are considering entering a new target market, with an existing or new product or service, it makes sense to first systematically analyze the market in question via some fundamental market evaluation criteria. It is not only rational but most cost effective to determine if a new market pursuit makes sense for your company before any significant resources are further applied to the effort.

A "pass or fail" test of your targeted market is recommended with your company's core management team collective involvement. Discussing the attributes of a given market and further analyzing the business logic behind your intention to participate in a new market will generate some very enlightening conversation among your key decision makers. Having various management functions present for the discussion generates the most effective, broad base perspective, appropriate "next step" for this strategic decision.

Besides further justifying or reducing your intentions to enter a new market, weighing all the same attributes of any one targeted market candidate against another target markets of consideration can lead to a pivotal decision for the future direction of your company. The opportunity cost of choosing the "wrong" or "least rewarding" target market, given limited corporate human and financial resources, can make or break your collective ability to meet or exceed your company's short and long term growth objectives. Again, effectively utilizing a simple, systematic evaluation checklist made up of some of the market attributes listed below can be most time efficient and cost effective.

Our list of market attributes cover various business sectors and should not be considered a complete listing. To make this evaluation exercise most productive for your management team, first evaluate this list for relevancy and then add whatever number of additional categories or attributes that correlate to your company's collective business priorities, resources, risk/ reward tolerance levels and growth objectives.

MARKET PRODUCT / SERVICE LINE ATTRIBUTES:
* Market has a viable need for product application advancements or transitions
* Market is not dominated by short product life cycles
* Market allows for effective competitive advantage without extraordinary design, engineering or research cost
* Market allows for effective competitive advantage without extraordinary testing, certification or performance compliance issues
* Market offers opportunities for relatively high product / service gross profit margins
* Market does not require a large number of products or services to effectively compete
* Market share is gained more from product value or by high value service
* Market product/ service applications have worldwide demand
* Market product/ services are compatible with existing company core competencies
* Market product/ service offerings can be legally protected
* Market generally does not present extraordinary financial liability exposure
* Market demand is not extraordinarily seasonal or difficult to forecast

MARKET CUSTOMER ATTRIBUTES:
* Market offers a diversified mix of key customer product / service users
* Market offers financially stable customers
* Market offers relatively consistent purchase loyalty
* Market has existing product/ service users who will purchase other related offerings
* Market is supported long term by fundamental economic and demographic growth

MARKET SERVICE ATTRIBUTES:
* Market does not require an inordinate amount of after-the-sale service
* Market can be supported by a centralized customer service location
* Market does not require extensive service certification from 3rd party entities
* Market does not proliferate extraordinary product/ service warranties
* Market service requirements are not hazardous to company personnel
* Market does not require extraordinary distribution requirements
* Market share can be augmented with effective e commerce tactics

MARKET COMPETITION ATTRIBUTES:
* Market is dominated by well known competitors and suppliers
* Market is not dominated by one company (> 80% market share)
* Market has reputable competition, a quality image and history
* Market offers competitors that would be future acquirers or acquisition candidates
* Market is not targeted for international penetration via pricing tactics
* Market requires a reasonable level of financial and technical resource barriers to entry

MARKET GROWTH:
* Market has a proven history of growth
* Market has a high probability of long term future growth
* Market offers traceable causes of growth
* Market has worldwide growth
* Market has regional growth niches
* Market growth cannot be negatively affected by existing or pending legislation Justification of entry into any new market or niche thereof involves effectively identifying all viable competitors, relevant market attributes, key market participants and their market shares. Being able to strategically apply this qualified information with respect to your known company financial, technical and human resources can result in extraordinary business growth opportunities.

If you want to further quantify this analysis you can numerically weight each market attribute with your own specific market attribute priorities and then give numerical "grades" to any or all new market entry candidates to calculate a weighted value for each new market opportunity.

Evaluating new business opportunities should be a well thought out, straightforward, iterative process. Beginning the evaluation process with a simple tool to justify further analysis is a prudent procedure. The more effective your analysis, the greater the probability your strategic decisions will maximize return on investment.

About the Author:
Mark Smock is President of http://www.business-buyer-directory.com, the FIRST international business buyer directory of its kind. Business Buyer Directory provides a non-traditional means for proactive business buyers to locate businesses for sale worldwide that meet their exact registered purchase criteria.

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Google News Updated : Sat, 11 Oct 2008 05:49:35 GMT McCain Lauds and Attacks Obama in Same Day - New York Times CBS News McCain Lauds and Attacks Obama in Same Day New York Times - 41 minutes ago Senator John McCain of Arizona and his supporters at a rally on Friday in La Crosse, Wis. By ELISABETH BUMILLER LAKEVILLE, Minn. - After a week of trying to portray Senator Barack Obama as a friend of terrorists who would drive the country into ... McCain Moves to Soften the Tone at Rallies Washington Post John McCain, speaking to supporters, tries to defuse an anti ... Los Angeles Times Reuters - DetNews.com - Austin American-Statesman - The Miami Herald all 304 news articles Publ.Date : Sat, 11 Oct 2008 05:08:14 GMT G-7 Commit to `All Necessary Steps' to Stem Global Meltdown - Bloomberg Voice of America G-7 Commit to `All Necessary Steps' to Stem Global Meltdown Bloomberg - 1 hour ago By Simon Kennedy Oct. 11 (Bloomberg) -- Group of Seven finance chiefs, meeting after stocks plunged and as a global recession looms, vowed to prevent the failure of vital banks while failing to unveil new initiatives for thawing credit markets. Group of 7 Nations Seek Coordination in Rescue New York Times In latest bold step, Treasury will buy bank stakes The Miami Herald CNNMoney.com - The Associated Press - Boston Globe - FN Arena News all 890 news articles Publ.Date : Sat, 11 Oct 2008 04:03:42 GMT US Near Changing Stance on North Korea as Terrorist - Wall Street Journal BBC News US Near Changing Stance on North Korea as Terrorist Wall Street Journal - 1 hour ago By JAY SOLOMON WASHINGTON -- The Bush administration is hoping to announce as soon as Saturday that it is tentatively removing North Korea from its list of state sponsors of terrorism, in a bid to kick-start a stalled nuclear disarmament agreement, ... AP: US to remove North Korea from terror blacklist The Associated Press US May Remove North Korea From Terrorism List, AP Reports Bloomberg Los Angeles Times - Voice of America - Financial Times - The Miami Herald all 1,714 news articles Publ.Date : Sat, 11 Oct 2008 04:02:40 GMT Bush: US authority able to solve financial crisis - People's Daily Online Telegraph.co.uk Bush: US authority able to solve financial crisis People's Daily Online - 1 hour ago US President George W. Bush arrives in the Rose Garden at the White House to makes a statement on the economy in Washington, October 10, 2008. President Bush vows action on financial crisis Los Angeles Times Bush's Lullaby to the Markets Washington Post Birmingham Star - Wall Street Journal - CNN - Bloomberg all 1,302 news articles Publ.Date : Sat, 11 Oct 2008 04:12:49 GMT Democrats Are Gaining, Registration Data Shows - New York Times Los Angeles Times Democrats Are Gaining, Registration Data Shows New York Times - 2 hours ago By NICHOLAS CONFESSORE and GRIFF PALMER Some longtime Republican strongholds in New York are becoming increasingly Democratic, a striking change driven by demographic shifts, intense voter registration drives by Democrats and allied groups and sagging ... Campus registration drives in full swing KARE Ott, Hook face off for open county office St. Joseph News-Press The News-Press - Winston-Salem Journal - Tampabay.com - Beaufort Gazette all 739 news articles Publ.Date : Sat, 11 Oct 2008 03:20:33 GMT Genomics project unites four Wisconsin research institutions - Milwaukee Journal Sentinel Genomics project unites four Wisconsin research institutions Milwaukee Journal Sentinel - 19 minutes ago By KATHLEEN GALLAGHER Wisconsin’s four biggest academic research institutions will collaborate on an initiative aimed at giving the state national stature in the fast-emerging field of individualized medicine, Gov. Marshfield Clinic gets biggest donation yet Chicago Tribune Wis. governor unveils gene research triangle Forbes Bizjournals.com - GenomeWeb News (subscription) - WJFW-TV - WISN.com all 51 news articles Publ.Date : Sat, 11 Oct 2008 05:29:44 GMT Paulson Indicates Need to Purchase Bank Equity `Soon as We Can' - Bloomberg Telegraph.co.uk Paulson Indicates Need to Purchase Bank Equity `Soon as We Can' Bloomberg - 1 hour ago By John Brinsley and Rebecca Christie Oct. 11 (Bloomberg) -- US Treasury Secretary Henry Paulson indicated that pumping government funds into banks is a priority and said financial markets will remain volatile. US planning to buy equity in financial institutions Reuters Treasury Weighs Investing In Banks Washington Post International Herald Tribune - MarketWatch - CNNMoney.com - Bizjournals.com all 1,783 news articles Publ.Date : Sat, 11 Oct 2008 04:21:05 GMT RSS Software More Web Site Traffic

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