Data from the U.S. Bureau of Labor Statistics shows that more than one out of five businesses fail within their first year of operation. While the numbers may seem bleak, they paint a cautionary picture of the importance of tactful strategizing when launching a new organization. Entering a suitable field of operation is a critical aspect of organizational planning, as this decision can significantly influence a new business’s chances of survival and future success.

To begin an entrepreneurial pursuit that is primed for prosperity, aspiring founders must first make the vital decision of which type of business they will start. This guide, created by Madeline Clarke for TechRepublic Premium, highlights the five most significant factors that new entrepreneurs should consider when choosing a type of business suitable for their future endeavors.

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INDUSTRY SIZE, TRENDS, AND MARKET DEMAND

Let’s face it: Listening to industry analysts discuss market trends is far less inspiring than hearing stories of prominent business moguls starting multimillion-dollar companies in their parents’ garage. Still, I’d bet that any prominent business tycoon would express the importance of assessing market trends to ensure business success.

Market research is vital for forming business plans, as market trends can reveal insights about growing sectors and profitable industries. This is especially important for startups, as choosing to start a business in an expanding sector will improve its chances of survival.

Industry size and market demand can also impact your business’s success, as targeting a broader market can allow you to tap into a larger customer base. On the other hand, establishing a new organization in a niche market can mean having less competition and may make it easier to identify unaddressed customer needs.

To help you gain a good idea of viable business options, consider how market trends can reveal insights about future consumer demands. In finding lines of business that are currently popular, you can form predictions about business types that would be sustainable down the line.

Enhance your business knowledge with our in-depth nine-page PDF. This is available for download at just $9. Alternatively, enjoy complimentary access with a Premium annual subscription.

TIME SAVED: Crafting this content required 20 hours of dedicated writing, editing, research, and design.