Teenbusiness.com > Entrepreneurs > Business Plans > Competition & Customers

Teenvestors' business plans have to include an up-to-date analysis of their competition. Why? Because they need to know what aspect of the business they would like to concentrate on. Will they be offering completely new products or services? Will their products or services be variations of businesses that already exist? What benefits can they build into their products or services that their competitors don’t offer? Once young entrepreneurs have identified their target markets, they should figure out how to estimate the size of these markets and how to get in touch with potential customers.

There are several techniques other young entrepreneurs have used in figuring out the number of potential customers for their products or services. The right technique for your product depends on what you are offering.

Teenvestors who have neighborhood businesses, such as lawn mowing or house painting businesses, can poll residents in the area to gauge customer interest in patronizing their businesses. They can accomplish this by personally talking to their potential customers.

Before one high school student started his lawn-care business, he approached 60 of his neighbors. Here are some of the questions he asked these neighbors:

Is someone besides a family member mowing your lawns on a regular basis? If so, are you satisfied with the work?

Would you be interested in having your lawn mowed on a regular basis? Once a week? Once every two weeks? Or just on demand?

Would your lawn mower be available to use for cutting the grass?

Would you be willing to pay $10 per hour for the service? (Of course before he asked this question, he had already explained what services he intended to offer. In addition, he knew the going rate for lawn mowing. More on pricing later.)

This young entrepreneur was doing his market research by going directly to his potential customers: those who had lawns to be mowed.

In general, young entrepreneurs can usually find a way to contact their potential customers to estimate customer interest in their products or services. However, if a young entrepreneur is just sizing up the market, he should tell these potential customers so. It would be wrong for them to pretend that they are already running the business when in fact they are just doing research.