Did you know that there are 255 babies born in the world every minute? If you are a business minded person you will automatically think of selling diapers to the parents of the babies. The number of babies born is part of the demographics data. Demographics are numbers that give you a picture of a country or society; It can give a description of the population using numbers. In business there are different uses for demographics which I will show in this article.
It Helps Validate Gut Feel
One of the reasons why people do not start their business ideas is because they are not sure of it. In short, they doubt if they will make money with their gut feel or not. Many times people will encourage and tell them that their idea is good but still, they wait until nothing happens or they lose interest. This dilemma is common to non-entrepreneurs. Checking your demographics will increase your chance of starting a business.
Just like my friend in the egg business, he used demographics data to validate the trend in the egg consumption. He made a study by checking the growth in the population of the areas he is servicing, and found out that there is a big opportunity. Because he was able to validate, he pursued with his growth plans.
It Will Give You a Business Idea
One of the hardest tasks for a non entrepreneur is coming up with a business idea. In my blog, I receive a lot of people asking for business ideas, and because of this them, I came up with my Business Generator ebook. Aside from my ebook which you can use to create opportunities, you can also check the available demographics data. My example in the first sentence is an example of using demographics as a source of business ideas. There are other available statistics that will help you create a business idea.
It Will Show You Trends
Trends show you what events will happen to a business or an industry; both threats and opportunities. Again, just like my friend who owns an egg farm, he checked the consumption trends of the people for the next 5 years. In his study, he found that there is an opportunity and that is the reason that gave him the confidence to pursue his plan. In my IT school business, I made a study last 2008 about the most in demand career in the Philippines. What came out is nursing. Because of this study, I was able to turn the threat into an opportunity by offering medical transcription course. It was a hit and until now, many are enrolling in the program.
Opportunities show you what you can exploit. Threats show you what you need to avoid.
Application in Micro Business
The idea of checking demographics can also be applied in micro businesses. If you have an idea of selling food in the office, you can check the number of total people in the office and those who are willing to buy lunch instead of bringing food from home. The numbers will give you an indication if your effort is worth it or not, if you will make money or not.
Where to get data
The demographics data is available in different government sites. I usually check NCSB or NSO sites for data. It is also advisable to do a little reading on the topic of statistics, just to guide you on how to interpret the numbers.
So those are the uses of demographics for business. Since numbers do not lie, demographics is a good starting point to help you come up with a sound an solid decision. Big companies have used them to launch businesses and you can also use it for your small business idea. The next time you have an idea do some study and have it validated by numbers. Spending a little time checking your assumptions will prevent your business from failing.