Take time to understand your market

There are endless possibilities in the setting and running of small to medium scale enterprises (SMEs).

ZIMBABWE must have enterprises that are of high economic value, modelled along some re-engineering made so far across global businesses. 

It is generally agreed that entrepreneurial resources are always scarce.

This is the same reason why we must be careful in our processes. 

There are endless possibilities in the setting and running of small to medium scale enterprises (SMEs).

First, we must appreciate that there are critical economic relations that businesses are supposed to follow, which are well defined at each and every stage of the national or global economy.

For the benefit of colleagues who are yet to practically appreciate this subject matter, we have three main economic agents at any given point in time.

These are the households, industries and the government.

Any type of enterprise must respect these as an initial source for customers, engagements and legislation. An entrepreneurial business should have policies and structures that talk to economic agents at various stages of operation. 

There is need for a detailed classification, analysis and justification for sustained involvement, or exchange, by specific businesses.  

Households are the basis of economically viable enterprises, since that is where customers reside, making decisions on whether to consume or not.

The most critical task that many entrepreneurs take for granted is a head count of customers — that is knowing targeted customers in numbers, rather than a thumb suck or guesswork of some sort.

Ask yourself when last you did a simple census of your market.

Entrepreneurs must also define their targeted demographics by age, gender, income, social class, religion, tastes and preferences.  Most SMEs plan for the short-run, rather than on a longer view of what will remain as their market after there are gone.

I call this economics for business sustainability. Here, we do not only make figures but predict with accuracy and adjust before any type of failure. In this case the entrepreneur should not only ascertain demand for his/her offerings, but go a step further to know how the same market views the products, or services.

Sometimes we waste marketing or promotional efforts through selling a product or service to the wrong people. We might be selling our products/services to an upmarket class, yet it would be viewed as inferior by the targeted consumers.

Sometimes, we take super quality product to a low paying market. Think about it as we move forward. Some entrepreneurs do not even know that the business they are running is seasonal. As such, they continue with the same approach throughout the year. The principle of sustainably running an SME, as aforementioned, is to avoid insolvency through economic wastages.

Most entrepreneurs take time to reconfigure.But you might end up overproducing by flooding the market with what is not needed most or having a shortage.

Both scenarios are dangerous as in the latter you might end up creating room for your competitors to overtake and dominate your market. Of course, there is product/brand fellowship through competition.

But it should be managed as well.  Understanding your industry and any other related issues is also key. The industry you belong to has the power to determine your pace for success or failure.

It is highly unusual to be the only player in a particular industry, especially in this age of continuous research, innovation and development. Your business idea can even be stolen before it is structured.

This is why we have to patent our ideas and businesses.

The closer thing one can do is to become what economists refer to as a monopolistic business structure, where you defeat other related products in your industry through differentiation.

This is why branding is a recipe for successful uniqueness.

The same goes with industries where some end up as cartels. This is really frustrating to many small businesses as their prices, production and profitability end up being determined by others.

These will be people who may not even part of your vision, but operating as a gang to determine and influence the price you should charge.

What matters is how you crack the code which might not have any specific formula but personal business intelligence through analytics.

Learning should never end. You must consult whenever possible. Therefore, knowledge of your specific industry is critical in entrepreneurial re-engineering. After all is said and done let us respect the highest agent in any economy, who is the government.

There is no business that operates in a vacuum, especially with regards to policies, regulations, rules, laws and standards. There is need to adhere to these for sustainability and business survival factors.

Otherwise, penalties will lead to arrests and extinction.

Till then, think about these matters as you grow through enterprise.

  • Chigora is a businessman and academic. He is the head of Business Science at the Africa University’s College of Business, Peace, Leadership and Governance. His doctoral research focused on business administration (Destination Marketing and Branding Major, UKZN, SA). He is into agribusiness and consults for many companies in Zimbabwe and Africa. He writes in his personal capacity. — [email protected], www.fachip.co.zw or +263772886871.


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