Outline the importance of businesses engaging in market research - Leaving Cert Business - Question C - 2022
Question C
Outline the importance of businesses engaging in market research.
The Cleaning Crew, a home and industry cleaning company based in Wexford, has seen growth in deman... show full transcript
Worked Solution & Example Answer:Outline the importance of businesses engaging in market research - Leaving Cert Business - Question C - 2022
Step 1
To Establish Size/Potential of Market
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Businesses undertake market research to identify the size of the market and the possible percentage of the market that they could target. This helps the company understand the overall potential for expansion.
Step 2
To Identify Demand for a Product/Service
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Products can be tested on the market to establish if there is a viable demand for the new cleaning services being offered. This ensures that the expansion decisions made are informed and based on actual market needs.
Step 3
To Set Prices
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Market research helps in identifying costs involved in production and sets guidelines for determining a competitive price. This is crucial for aligning the service prices with that of target market's ability to pay, based on competitor analysis.
Step 4
To Identify Competitors
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Understanding other businesses in the market is critical. Market research aids in identifying your unique selling proposition (USP) and informs promotional strategies needed to stand out.
Step 5
To Access Finance
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Companies looking for investments must engage in market research to establish their viability and profitability potential. Investors often rely on this data to make informed decisions.
Step 6
To Identify More Opportunities
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Engaging with potential customers and monitoring trends through market research helps businesses make informed decisions about future product offerings and strategies.
Step 7
Reduces Risk of Failure
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The more a business engages with market data, the higher its chance of survival and competitiveness. This proactive approach to market research minimizes risks associated with expansion.
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