This can also be referred to as an environmental or industry analysis. The goal is to discuss local and national trends in business, current economic factors, technological shifts and industry demand. At the end of the section focus on the local community and how you plan to integrate your business into it. This section will also form an important basis for your marketing overview and financial projections.
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The market analysis will take the most research out of any section in your plan. The questions listed above can be found by going to your local library, or searching the most recent census statistics. As you define your target customers (the individuals most likely to purchase your products), don't feel the need to constrain yourself to one group. Often there are multiple types of individuals buying the same product, but for different reasons.
This is a good time to establish a strategy for how you are going to reach out these people, don't go into too much detail, this is really just a primer for your marketing overview. You will also want to spend some time talking about specific competitors that operate within the same space as you. What is your competitive edge, what makes you better than them?
Remember, if you're having a hard time coming up with ideas or you're not sure how to format the section, you can refer our Sample Business Plan Template Here.