Investment For Retirement :: Agent Training :: Retire Rich

The Size of Your Target Market Versus Your Profit

by Samson Itoje

The size of the target market for the products or services your business sells will have a direct impact on the profit potential of your business.

So, what is target market?

The target market for your business is the group of potential customers who are likely to be interested in the products or services offered for sale by your business.

Remember that not everyone in your target market will buy from your business because of issues such as . . .

>> The presence of strong competition

>> The business environment

>> Product coverage / licensing limitations

>> Price differences

>> Regulatory challenges, especially across countries

>> Shipping costs

. . . and a host of other considerations which may be outside your control.

However, irrespective of the challenges listed above, the size of your target market still plays a huge role in the level of profitability of your business.

The Concept of Market Share

When your business offers a product or service that adds value to your customers, and your business offers quality after-sales service, your business is bound to have some customers.

The percentage of customers your business secures relative to the total market size is called your market share.

Now suppose the size of your target market is about 100,000 people.

If your business sells to 1 percent of that market size per year, your business will make a total of 1,000 sales.

What if you can somehow increase the size of your target market to, say, 1,000,000 people while retaining your market share of 1 percent?

Well, in this second scenario, your business will make 10,000 sales per year. That is, your business gets to 10 times more sales simply by targeting a bigger market size.

Bottom line.

If you want to start a business that will make you lots of money, choose a business that gives you an opportunity to sell to a larger audience.

Yes, increase the size of your target market!

How To Increase The Size of Your Target Market

So, how do you increase the size of your target market so as to improve your chances of making more sales and more money from your business?

It all starts with your choice of business.

When thinking of starting business, choose a business that allows you to sell to more people . . . a business that is not limited by location.

For example, think of business people who sell internet modems that provide internet connectivity to people within a small town.

If the town has a population of 100,000 people, and the internet modem will not work anywhere else, then this business person has a serious cap on his market size.

Consider a different scenario.

Suppose a business person who lives in a country with a population of 100 million people sells a product that can be easily shipped to anyone anywhere in the country.

Suppose too that the product is a food product that lends itself to repeat purchase several times a month.

This two combination . . . large target market and high repeat purchase potential . . . immediately creates a deluge of demand that can skyrocket the business owner's sales and profit far beyond his dreams.

Bottom line.

Think deeply about the size of the target market (and potential for repeat purchase) before choosing to invest in a specific business.

Choose to sell a product or service with wider appeal . . . a product or service that can be sold to at least everyone in your country not just people in the small town where you live.

Have questions or comments.

Click the link below to post them.

Click here to post comments

Join in and write your own page! It's easy to do. How? Simply click here to return to Entrepreneur Forum.

Rethink Retirement

FREE 7-Day E-Course: Rethink Retirement - 7 Tips To Escape The Rat Race And Retire Happy

Simply enter your email in the box below and click subscribe

retire wealthy ebook
One billion dollar business ebook
financial freedom ebook
Rethink Retirement
internet business ebook

Follow Us On:

Recent Articles

  1. Real Estate Agent Training Nigeria - Earn Extra Income As A Realtor

    May 21, 19 08:38 PM

    Real estate agent training in Nigeria for anyone who desires to make money part time or full time from the Nigeria property market. Realtor training manual for novices and estate agents. Get the skill…

    Read More

  2. Real Estate Investing Opportunity Lagos Nigeria - Make More Money

    Mar 17, 19 08:16 PM

    Real estate investing opportunity in Lagos Nigeria. High return on investment land for sale in Lagos. Buy now. Make more money from your property investment.

    Read More

  3. Sales Leads Software Nigeria - Lead Generation And Marketing App

    Mar 16, 19 06:54 PM

    Sales leads software for marketing and sales automation. Facebook messenger lead generation, follow-up and conversational selling software. Guaranteed high conversion rate and increased sales.

    Read More