The “What Would Chris Do?” series centers on different business topics. First up? The importance of market research.

For my next few articles, I am going to do a series called ‘What Would Chris Do?’ The scenarios will revolve around starting a new business in our industry. Each article will cater to a different scenario and what my strategy would be.

For my first article, let’s look at my first advice for any startup scenario; market research. By doing market research, we are hoping to find out at a bare minimum the following information:

1. What is the market penetration for PPF, tint and ceramic coatings?

2. Who is the competition?

3. What are the main brands being sold?

4. What is the average pricing?

5. Are dealerships offering the products/services?

The answers to these questions will determine the route I go with starting the business so I will break each one down and why it is important to look at it.

1. Knowing how much saturation/penetration exists in a market is very important. The less penetrated a market is, the more we will focus on product awareness, i.e. – car shows, dealership wholesale accounts, enthusiast groups, etc. Whereas when we are in a heavily-saturated market, we will look more at our competition and what holes we can fill, i.e. – quality, service and price. Market penetration also helps us decide what offerings/packages we would offer (if we have a very infant market, we pitch partial coverages over full car coverages) and what clientele we would cater to (high-end versus daily drivers for example).

2. Knowing the competition is crucial. Not only can we learn from what they are doing but we can also look for deficiencies in their business model/product offerings. If I am looking at opening a new business, I want to know who all my competitors are by researching their reviews, going by the shop to see if it’s busy, and secret shopper calling to get pricing and hear their sales pitch. If it is a solid business that is very well known, I want to look at ways to keep them close (figuratively). If I try and go head-to-head with them as a new installer/business, that can be a tough battle to fight, whereas if I let them know I plan to open up and will stay clear of their accounts and get a spot on the other side of town, I know have an alliance versus an enemy. As they say, “Keep your friends close and your enemies closer.”

3. It is important to know your brands before starting. Partnering with the right brand is like taking the escalator versus the stairs. I say partnering because it is more than just purchasing (unless you decide to pursue wholesale/bottom price accounts where brand doesn’t matter and it is just about volume). Currently, in our industry, consumers are becoming much more aware of brands and actively seek them out.

If you can’t partner with a brand because of territory rights, ask that brand what would be a good alternative you can go with until an opportunity opens up. I personally have a list of products I recommend if someone cannot use the brand I currently represent.

4. Knowing your local market pricing is important. This will help set your pricing. Being the lowest is never good, even though you think it will get you work in the beginning. It brings the whole market down and you miss out on many customers.

If I go to buy headphones and I see a pair for $200, $400, and then $89, I never buy the $89. But are the $89 headphones as good as the others? I never even check to be honest. Call it ignorance but I am just being honest that I never choose the lowest priced. Building a business on the bottom-tier pricing is tough and takes a very specific business model.

I would never recommend it to a startup. Remember, too, that going the other way and being the most expensive means you have to deliver that quality and service to justify that. I recommend being in the middle and then if you need the sale, make sure to attach the reduced price to a sale, even if it is “a new business sale!”

5. Dealerships are an important part of our industry. Not only are they the first engagement with new car customers, but they also can educate and sell our products for us (meaning many more mouthpieces for our services than just us). A quick walk of a new car lot or a chat with a friendly sales associate can give a lot of information on whether or not they know about your products.

In closing, if you are considering going into business in this industry, you have to do market research—whether you are just starting out as an installer/entrepreneur or if you are a seasoned installer wanting to go out on your own. Do not just say, “Well, my current shop is doing great and my boss makes tons of money,” or “I have a buddy that used to do insurance with me and now has his own shop in XYZ city and is killing it.” Yes, there are opportunities everywhere, but if you don’t research and have a business plan/roadmap in place, you will spend five years (if you make it that long) learning some hard lessons that could have been avoided by having a well-executed strategy.

Stay tuned for the next article where my scenario will be: “I want to get into the business but have never installed.”