Question
Explain any four important aspects to be considered while doing market assessment by an entrepreneur.
OR
What is market assessment? Why is it needed for an entrepreneur?

Answer

Market assessment is the process of future evaluation of the feasibility of a product or service or an enterprise to be launched in the market. An entrepreneur needs to consider following factors before selecting the product or service:
  1. Demand: This is the first and most important factor of market assessment. The demand assessment will be based on the size of market being targeted i.e. local, state, national and international level markets. This study also includes the study of the target groups of consumers, their preferences, task and other related variables.
  2. Supply and nature of competition: while making assessment, supply position also needs to be studied by the entrepreneurs. Supply position makes the complete picture clear about the quantity of the product made available in the market by all the existing competitors.
  3. Cost and price of the product: Determination of cost is important because it helps in determining the price of the product to compare with the price of similar product available in the market.
  4. Project innovation and changes: Market assessment also includes a complete study of prevailing innovations and changes like technological advancement which are being carried out by the existing entrepreneurs in the market.

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