The Market
Research of the business plan is the simplest and the most fun part of writing
a business plan.
Now a
forewarning, one can drown in the amount of data available to input into the
Market Research section of a business plan.
This is why commonly Market Research is sometimes developed separately
when a more in-depth analysis is warranted.
Market
research (in some contexts known as business research or industrial research)
is any organized effort to gather information about target markets[1]
or customers. It is a very important component of business strategy.[2]
Over time
the term “market research” has become synonymous with many other ways of saying
“research about your business”. The
term is commonly interchanged with marketing research; however, expert
practitioners may wish to draw a distinction, in that marketing research is
concerned specifically about marketing processes, while market research is
concerned specifically with markets.[3]
Some sections
that can be included in the market research section of the business plan
include:
· Market information: This can include
prices in the market for a similar product or service and supply and demand
statistics about the market.
· Market segmentation: This can include information and data that is
divided into subgroups. This can include
breaking down data by geography, income distribution, sex, nationality, etc.
· Market trends: This information includes data points that
show the trend upwards or downwards for a certain market activity that
demonstrates a strong demand for the product or service offered in the business
plan.
· SWOT Analysis. This includes the strengths, weaknesses, opportunities,
threats of the organizations position in the market. Click here for more information of the SWOT Analysis.
The best way
to showcase the market research section of a business plan is to give an
example. Below is an example of a consolidated
section of market research for an Urgent Care Center in Hartford County, Connecticut.
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Hartford County, CT Market Demographics
Hartford
County is a county located in the north central part of the U.S. state of
Connecticut. As of the 2010 census, the population was 894,014 making it the
second-most populous county in Connecticut.
As of the
2010 United States Census, there were 894,014 people, 350,854 households, and
227,831 families residing in the county.[4]
The population density was 1,216.2
inhabitants per square mile (469.6/km2). There were 374,249 housing units at an
average density of 509.1 per square mile (196.6/km2). Of the 350,854 households, 31.9% had children
under the age of 18 living with them, 46.0% were married couples living
together, 14.5% had a female householder with no husband present, 35.1% were
non-families, and 28.7% of all households were made up of individuals. The
average household size was 2.47 and the average family size was 3.06. The
median age was 39.9 years. The median
income for a household in the county was $62,590 and the median income for a
family was $78,599. Males had a median income of $56,181 versus $44,273 for females.
The per capita income for the county was $33,151. About 8.0% of families and
10.7% of the population were below the poverty line, including 15.3% of those
under age 18 and 7.7% of those age 65 or over.
Urgent care centers in the U.S.: Findings from a national survey[5]
With long
waits for appointments with primary care providers, difficulty with same-day
access for sick care, limited access to after-hours care, and extended emergency
department waiting times, this decade has seen the growth of newer sites for
the provision of episodic primary care services in the U.S. . Driven by
patients' willingness to seek care at alternative locations, retail clinics and
urgent care centers have seen significant growth over the last decade. Given
their extended hours, availability of unscheduled appointments, and the range
of services they provide, urgent care centers are uniquely positioned within
the health care system to address the overflow of acute care patients from
primary care as well as low- to mid-acuity emergency department patients.
Recent
research has described the utilization of services and clinical content of care
for retail clinics. Other work has demonstrated that urgent care centers can
decrease non-urgent emergency department use without a concomitant increase in
hospitalizations; that urgent care center patient populations tend to look more
like those in physician offices than in emergency departments; that these centers
are busiest during the winter months; and that they can be more cost-effective
for providing urgent care than an emergency department. In addition, we
previously found that approximately two-thirds of urgent care centers have been
in operation for five or more years, and slightly more than half are
physician-owned.
Despite
this, the research base on urgent care centers in the U.S. has been lacking,
with prior studies having typically been conducted in single urgent care
centers. To date, there has been little information available about urgent care
centers based on a nationally representative sample. In this paper, we describe
the results of a recent survey of urgent care centers that is designed to
understand how they are organized and how they function in the health care
system. Throughout this paper we define urgent care centers in a manner
developed in conjunction with the Urgent Care Association of America and
consistent with prior definitions. This includes those health care
organizations that are not emergency departments, but typically (a) provide
care primarily on a walk-in basis; are open (b) every evening Monday through
Friday and (c) at least one day over the weekend; (d) provide suturing for
minor lacerations, and (e) provide onsite x-rays.
Key Statistics from
Survey
· More than two-thirds of urgent care
centers open prior to 9:00 am during the week, with significant proportions
doing so on Saturday (45.7%) and Sunday (31.1%). In addition, the majority of
centers remain open until 7:00 pm or later on weeknights (90.6%), with two out
of five remaining open until 9:00 pm or later. Approximately four in ten
centers also remain open until 7:00 pm or later on Saturdays (40.9%) and one in
three do so on Sundays (34.1%).
· On average, urgent care centers saw 314
patients during the week preceding their response to the survey, resulting in
an average of 65.4 patients per urgent care physician per week. This is
slightly lower than the national average of 84.4 visits per family physician
per week, though comparable to the figure for family physicians in some regions
of the country (e.g., 63.9 per week in the Mountain region). Approximately one
in five urgent care centers have more than 450 patient visits per week (21.7%).
· In addition to suturing lacerations
and providing onsite x-rays (required to meet our definition for inclusion in
the survey), urgent care centers provide a wide variety of services.
Occupational medicine is a significant component of the services provided by
many centers, with more than nine in ten centers providing such services.
Workers compensation evaluation and case management (37.2%) are substantially
less likely to be provided than other occupational medicine services such as
employment-related physicals, drug testing, and treatment of illness and
injury.
· While other diagnostic testing such
as CT scans and ultrasounds are comparatively rare at urgent care centers, many
centers provide a wide variety of other services. These commonly include
fracture care (provided by 4 out of 5 urgent care centers), pain management
(including prescribing and/or dispensing medications to manage acute and/or
chronic pain), primary care, immunizations, and routine school and sports
physicals. Seven in ten urgent care centers can provide intravenous fluids when
needed. In addition, nearly half of urgent care centers (48.6%) provide
prescription pharmaceuticals that are pre-packaged for dispensing a full course
of treatment in doctors' offices rather than in pharmacies
("point-of-care" dispensing).
Retail walk-in clinics treat a variety of
non-life-threatening but frequent illnesses, including bronchitis,
mononucleosis, pink eye and sties, sinus infections and minor injuries. Usually
open in the evening and on weekends, they also offer vaccinations for flu,
pneumonia, childhood diseases, tetanus and other diseases, physical exams for
jobs or team sports and preventive measures such as checking blood sugar. A study by Mehrotra and colleagues published
in 2009[6]
in the Annals of Internal Medicine looked at 700 episodes of each of three
common conditions — inflammation of the middle ear, urinary tract infections
and pharyngitis, an infection that causes most sore throats. Using 12
quality-of-care measures, it found that treatment was “similar for retail
clinics, physician offices and urgent care centers, and lower for [emergency
rooms].” The costs of care for each episode averaged $110 at retail clinics,
$166 at doctors’ offices, $156 at urgent care centers and $570 in emergency
departments. Most walk-in clinics are staffed by nurse practitioners or
physicians’ assistants, and nearly all take private insurance, Medicare and
Medicaid. Costs per visit are in the $79 to $89 range, with additional charges
for lab tests. A quick strep throat test, for instance, is $30 at a CVS clinic.
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Please keep in mind that every business plan is different and may include or not include certain sections depending on many factors. The market research section should be written to inform the business plan reader about the potential and expose any hurdles to the management team. Hope this was helpful.
-Nick
PS: Are you looking for a professional
business plan writer? Contact by emailing me here or text/call me at 203-685-0346 to schedule a time to discuss your business plan
writing needs.
[1] A
target market is a group of customers within the serviceable available market
that a business has decided to aim its marketing efforts towards. A
well-defined target market is the first element of a marketing strategy.
Product, price, promotion, and place are the four elements of a marketing mix
strategy that can help determine the success of a product or service in the
marketplace.
[2] McQuarrie,
Edward (2005), The
market research toolbox: a concise guide for beginners (2nd ed.), SAGE,
ISBN 978-1-4129-1319-5
[3] McDonald,
Malcolm (2007), Marketing
Plans (6th ed.), Oxford, England: Butterworth-Heinemann, ISBN 978-0-7506-8386-9
[4] https://en.wikipedia.org/wiki/Hartford_County,_Connecticut
[5] http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2685126/
[6] https://www.washingtonpost.com/business/why-walk-in-health-care-is-a-fast-growing-profit-center-for-retail-chains/2014/04/04/a05f7cf4-b9c2-11e3-96ae-f2c36d2b1245_story.html
