Whether you're opening a jewelry store or a scrap metal yard, your market determines most of your other business decisions, like choosing a location, advertising, and capital investments. Before you rush into making expensive purchases you might not need, analyze your market thoroughly. First, decide who is going to buy what you're selling. Ask yourself:When people buy what you're selling. Do they buy it at a certain time of year or at a certain time of life? For example, jewelry is purely a luxury item. People don't buy jewelry before they've bought groceries or paid rent, so if you were opening a jewelry store, you wouldn't want it to be on a street in a warehouse district; it needs to be in a place where people go when they want to spend money, like a commercial district.
Why people buy what you're selling. Do they buy it out of necessity or whimsy? Not only does this influence things like location, it also influences marketing. For example, people don't need cupcakes, they just want them. So if you are opening a cupcake shop, you might want to locate it in a place where lots of people inclined to indulge their wants, like children and vacationers. You might want to market it in places where people are feeling good, like sporting events, fairs, and festivals, so they associate your cupcakes with good memories.
 Once you've got a general idea of who your buyers might be, narrow the focus as much as you can. You can expand in good time, but a new business won't be able to effectively be all things to all people, so you need to target groups that you understand and have access to.Going back to the jewelry store example, you know generally when people buy jewelry and under what circumstances, but that's not a very sharply focused target market. But a jewelry store that targets young African-American men in Queens making between $30,000 and $60,000 a year is sharply focused on a particular market. If that's your target, it gives you an idea of who to market to, where to open, and what kind of inventory to buy.
 Once you've got a specific idea of who your target market is, put yourself in their shoes. Consider what the features and the bugs of the buying experience are and how you can improve on them.Instead of just thinking about what the buying experience entails, actually go through the motions of buying your product at several of your various competitors' establishments.Take notes about your experience. Think about where it was frustrating and where it was rewarding; if there's a disconnect between why the customers buy and how the sellers market and sell. Then see where you can make improvements.
 Before you dive in, see how deep the water is. Test your assumptions with a low-cost test run. Once you've got the results, modify your strategy accordingly, discarding what doesn't work and keeping what does.For example, if you're launching your cupcake bakery, offer free samples at public events. See what people like and what they dislike and change the menu accordingly.
Decide who's going to buy what you're selling.
Narrow your focus.
Put yourself in the customer's shoes.
Test the market before you launch.
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