(In this picture: two of our beverages at a retail shop in Jinja).
From time to time I get messages in my inbox requesting me to look into various small businesses and the ideas on which they are built. After looking at so many, I have noticed a common mistake that most small business owners often make when starting their enterprises. They overlook the importance of identifying and assessing the demand for their proposed product/service.
In 2009 while only a first year student at Campus, I had the idea of taking part in the annual National Agricultural Exhibition Show in Jinja district. Now this ‘show’ like it is popularly known, is the next big thing after the UMA Trade Exhibition. I grew up attending this show and noticed that over time it had drifted away from matters agriculture to trade. So in 2009 I decided I wanted a piece of the trade. My idea was simple: sell movies, art pieces and African art screen printed T-shirts. I had about 200 movies of the good stuff at the time, 10 art pieces and 30 t-shirts. I figured I could move these items within the one week that the show ran. Now let me point out that I had some really ‘good stuff’ but unfortunately I was in for a huge surprise.
It is obvious I made little to no effort to closely study the kind of people who attended this show, their expectations, interests and the average amount of money they had to spend. The majority of the attendees came for agric purposes, to have some fun (eat, drink, dance and meet new people), see new things, buy discounted household items, to pass time among many other casual reasons. No one came to this Show just so they could buy a movie or a painting. In any case, I thought the many tourists who frequented Jinja district would jump at the opportunity to get their hands on some nice discounted paintings. I was wrong. Turns out those tourists came for the experience and not to necessarily make purchases. In the end my sales were not nearly enough to offset the investment. I guess I should have known better.
When you get into a business without thoroughly assessing the demand for your proposed product, you risk bringing to market something that very few people need and/or are willing to pay for. Unfortunately for many small business owners who make this mistake, they don’t realise it untill it’s too late. They instead find themselves stuck with inventory that no one is eager to buy. Here is my key take away: study the market as much as you can. Find out if there is anything similar on the market. If so, how has it been received and how are it’s sales? At what stage is the market? Is it still growing, at peak level or on a downward trend? If the product or service does not exist yet, identify your potential key segment and engage them. Is there interest in your product? How about willingness to pay? Does the interest and demand look sustainable in the longrun? Can you go as far as to create a prototype to get more verifiable feedback? There is no limit to what you can do to acertain interest and demand. I have since learnt from my past mistakes. Today I encourage you to make smart business decisions. Do your research.