A: Research figures like the ones you're looking for -- typically included in business-plan sections on the size and scope of the market -- are not hard to locate if you're willing to do some digging. Often, would-be entrepreneurs don't realize they need to immerse themselves in their industry of choice before making specific plans to produce and distribute a particular food item, recipe, or product they hope will be a big seller. Without knowing what else is on the market, how it's selling, and whether the product niche is already crammed with popular products, making specific plans is usually a waste of time.
To fully understand and appreciate your market, investigate the industry groups, trade publications, and consultants working with specialty food products, which is what sauces or marinades are considered. Experts will tell you that the field is crowded, competitive, and tough to break into. Finding a niche and differentiating your product is the key.
Think about it: Spicy sauces, sweet sauces, Thai sauces, Mexican sauces, exotic fruit sauces -- no matter how tasty your product is and how much appeal you believe it has, it's hard to find a category that hasn't already been tapped. With more and more new products boasting the endorsement of a particular restaurant chain or celebrity chef, the generic sauce has an even harder time competing for shelf space.
GETTING ORGANIZED. That said, you should be able to find the numbers you're looking for by gleaning information from industry trade organizations. The National Association for the Specialty Food Trade is the most prominent of these groups. Two of three times a year, it sponsors large trade shows that are must-attend events.
Don't think about exhibiting the first time around: Just go and experience the atmosphere of the trade show, sample products, check out the booths, talk to your competitors, and meet the buyers who are there to look for next year's big sellers. Such a visit will give you a steep boost up the industry's learning curve. Do some Web surfing to find other, even more specialized trade organizations you can join. The food industry has hundreds of them that provide good information, support, and analysis for members.
Depending on your budget and how specific the data you want, you can also pay for market research from firms that specialize in industry analysis. Financial Research Associates and the Risk Management Assn. collect, analyze, and publish data taken from annual statements and bank documents. They boil down the numbers, giving you benchmarks that are extremely helpful in evaluating the competition and making financial projections. You pay only for the data that applies to your industry, region, and business size. Financial Research Associates specializes in small businesses capitalized at less than $1 million. Each provides several ways to purchase the data, such as CDs, books, and via the Web. Have a question about running your business? Ask our small-business experts. Send us an e-mail at firstname.lastname@example.org, or write to Smart Answers, BW Online, 46th Floor, 1221 Avenue of the Americas, New York, NY 10020. Please include your real name and phone number in case we need more information; only your initials and city will be printed. Because of the volume of mail, we won't be able to respond to all questions personally.