Market Analysis Summary
As computer and office jobs get more and more common, the general working population will experience more health problems caused by improper office working environments. It may be it’s their wrists aching from typing, their back hurting from their chair being bad, or their eyes damaged from staring at a computer screen. Ergonomic products focus on solving these problems. Unfortunately, these products are often hard to find at general furniture stores or office supply stores. WorkChairs aims to supply these products to both our local market and in the online space.
Specifically, we’ll target a few different types of worker:
- The home office user.
- The small business office manager.
- The large organization purchasing manager.
4.1 Market Segmentation
We have broken down our target market into the following categories:
- Home Office – This segment is the huge market of people running businesses from their home. We estimate there to be about 20,000,000 home office businesses in the United States, with about a 5% growth rate. Since we can reach the whole United States with our website, we can, potentially, reach the entire market.
- Small Office Managers – The small office market is also quite large, with a 5% growth rate. Most of these businesses have office workers who would be in need of ergonomic products.
- Large Office Purchase Managers – This market segment is much smaller in size, but has huge potential for sales as purchase managers usually make bulk buying decisions for multiple workers. It has a slower 2% growth rate due to fewer large businesses being created.
|Year 1||Year 2||Year 3||Year 4||Year 5|
|Small Office Managers||5%||2,000,000||2,100,000||2,205,000||2,315,250||2,431,013||5.00%|
|Large Business Purchase Managers||2%||500,000||510,000||520,200||530,604||541,216||2.00%|
4.2 Target Market Segment Strategy
The following are our market segments along with our reasoning for targeting each segment:
- Home Office – This segment is very large, and because most home offices now involve people spending long hours on a computer, these people are prime targets for needing ergonomic equipment. Since these offices are also in their home, they’re more likely to spend some money on nicer furniture and equipment they can use for both home and work purposes.
- Small Business Managers – Most small businesses have a manager in charge of equipment purchasing decisions. At some point, most of these managers usually have an employee who suffers from a problem that can be solved with ergonomic equipment. Even if they haven’t, these people can usually be educated on the benefits of an ergonomically-sound workplace. They are usually pretty careful with their money though, as most small businesses try to keep their costs low. It’s a good market, especially locally, because these business often support other local small businesses.
- Large Business Purchase Managers – Large businesses usually have a purchase manager who’s sole job is making equipment and supply purchasers. It’s usually harder to reach these managers, and there are fewer large businesses, but they make for very lucrative accounts. Once you can build a good relationship with a purchase manager, they can be responsible for a lot of sales. Most purchasers buy equipment in bulk, and they usually have budgets that allow them to buy good equipment.
4.3 Industry Analysis
The ergonomic industry is growing by leaps and bounds. As the use of computers increases in offices, people are experiencing lots of health problems from repetitious use of computers all day long. The ailments can really vary, but knowledge of ergonomic products is growing as people realize these problems exist.
The ergonomic product manufacturing industry is also growing as more companies are putting out new products for cheaper prices.
WorkChairs aims to sell locally to small and large businesses, while also serving those two markets and the home office market on the Web. We believe this combination of local and nationwide sales will provide a solid base for a business.
4.3.1 Competition and Buying Patterns
People shopping for ergonomic products choose their retailer based on the following criteria:
Product selection: They want to work with a company that provides a number of ergonomic products to choose from, including competing brands.
Price: Nobody wants to pay more than they have to, and generally ergonomic products are more expensive than people anticipate, so price is usually a big issue.
Customer Service: People usually have questions before purchasing an ergonomic product because, for the most part, they have never seen or worked with the product before. This means that our website must explain things well and make it easy to contact us. We also must provide great customer service locally to keep our clients educated and happy.