Small businesses: How research can reduce risk and save you money

Most business ideas contain an element of risk. It comes down to the successful entrepreneurs to turn that risk into profit and perhaps even expansion when the time comes. But how do you ensure you don’t tip money and resources down the drain with a risky venture? Whether you’re just starting out, or considering taking on a new partner, the answer is research.

Save money in marketing

Marketing is a big area where you can reduce both expenditure and risk. Start by saving on costly marketing campaigns by doing your own ground work, rather than outsourcing the work to a freelancer or another company. There are plenty of free online company databases available, as well as the business section at the local library. You can even conduct primary research, and find out what your client base is looking for.

You’ve probably also heard of competitive intelligence, and how you can use it to get an edge over your rivals. But by looking up your competitors on social networks and in the media, you can also avoid the risks of going into the marketplace blind – you can already have an idea of how to conduct a successful venture, as well as note any mistakes that your rivals may have made.

When you’re in the planning stages of a new business, researching your intended field will enable you to set down accurate cost estimates, define goals and sharpen your marketing strategies.

Minimize the risks in a partnership

Research is a key skill for businesses at every level. While expanding to take on partners can actually make you more money, it’s still a risk, especially if you haven’t done your homework. Ill-advised partnerships can lead you in the wrong direction and result in wasted time and resources.

Again, use social networking sites and company databases to find out what potential collaborators have done in the past and whether they can bring compatible services to the table. For instance, if you’re a whizz with numbers, you might not need someone whose key skills lie in accounting.

If you find out about an individual beforehand, you can determine whether they have expertise that’s worth sharing your profits for and also whether they share your approach to business. Arrange to meet up and discuss what they can offer your company. If you don’t have common goals, keep looking.

A large part of business is about risk and expenditure control and you may be surprised at how useful research can be. Saving resources in business can always be done by cutting travel expenses or lowering energy bills, but research is a proactive approach that leaves you less open to risk and ensures the time you spend on the company represents good ‘value for money’ at the end of the day.

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