Criteria for choosing a niche for business in a small town

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We will also add that the Russian Federation has a diverse system of business support, including both national instruments and specialized programs for regional and industry development. For example, grants and subsidies are available for young entrepreneurs, development of the agricultural sector, innovative startups in the IT sphere and other key areas of the economy.

Now let's look at the features of small towns that make starting a business more difficult:

Lower purchasing power of customers.

People's salaries are small, and therefore it is quite risky to open luxury establishments (restaurants, beauty salons, brand boutiques, etc.) in a small town. Most likely, there will be very few buyers. However, shops and cafes with low and medium checks may well be in demand.

Smaller audience.

This is a significant disadvantage chile email list for companies selling expensive products that people buy once and for a long period. There are few people in small towns, and therefore the risk of a rapid decline in demand is high. Let's look at an example. You opened a furniture factory.

At the start, there were many buyers, but literally a couple of years later, the entire population had already furnished their living rooms with sofas. And new clients stopped coming because there was nowhere for them to come from. The business will have to be closed or expanded through online sales, which will require creating an online store and setting up a delivery process to other localities.

Monopoly businesses.

Small towns often have establishments that are familiar to the locals, and it will be very difficult for newcomers to compete with them. For example, you are planning to open a burger joint, but the city already has a chain of fast food establishments where residents constantly order food, celebrate birthdays, and have dinner with their families. Even if you make completely different sandwiches and can offer customers a higher-class service, you will have to work hard to convince people to choose you.

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Criteria for choosing a niche for business in a small town
When choosing and comparing options, pay attention to several key criteria:

Resources : Consider whether you have the resources and qualifications to start in a particular niche.

Payback . Develop a business plan, analyze how long it will take to break even and start making a profit. This criterion is especially important if there is no financial cushion that could allow you to wait, so you need to start earning as soon as possible.

Relevance . Estimate what percentage of the city's population will be interested in your product, taking into account the solvency of customers.

Competition . If the needs of the target audience are fully satisfied, think about whether you have a chance to surpass your competitors. For example, you want to open a coffee shop, but there are already three similar establishments in your area. In such a situation, it is better to come up with something else.

Unique features of the area . Be sure to consider the type of activity of the city-forming companies. For example, this status in resort towns is often given to large sanatoriums where people from all over the country relax. In such places, it is rational to open souvenir shops, spa salons, massage rooms, etc.