Ignorance is bliss

Every once in a while those uncertain actions we take on a hunch are validated by a successful outcome. As small business owners, my wife and I make a lot of decisions from the gut. You have to. Market analysis is about 95% common sense and about 5% hunch. Several years ago when my wife started her elective ultrasound center, we did a full scale market analysis. We researched the total available market utilizing US Census data for our regional population and combined it with data pulled from South Carolina's Department of Health and Environmental Control on birth rates in our area. We divided the total available market into income level categories and analyzed the resulting cross sections. Through statistical inference we were able to quantify our projected target market. The numbers didn't lie. We knew going in that we would have to reach an abnormally high percentage of the target market in order to generate enough cash flow to remain solvent, but since there was no competition in the area, we decided to go ahead and take a leap of faith. Months into the ordeal and very near throwing in the proverbial towel, we realized that Dionysus had slain Apollo and the ensuing exuberance outweighed the rational. We ended up making significant changes to our business model out of necessity, but we emerged stronger and wiser in the end. We still offer elective 3D ultrasound, after all, being able to offer this incredible experience to women in the Lowcountry was the impetus for the business in the first place, and that hasn't changed. We spent a tremendous amount of time and energy to convert from an elective, self pay approach to a physician ordered reimbursable approach. It has already proven to be the best decision we have made to date. Last week while I was doing some research on the Internet I noticed that the owner of a well established elective 3D ultrasound center in the midlands had placed her business on the market for sale, effectively validating our hunch that an abnormally high percentage of the market is required to support these endeavors. I won't claim to know the underling reasons behind that sale, but based on her publicly disclosed financials, I'd say it was because it barely pays the rent. Been there done that. Like I said, market analysis isn't rocket science, it's common sense. Unlike other service oriented businesses, the market for elective ultrasound is finite, meaning, you can't manufacture clients --without an army of irresponsible gigolos. To be in the market for a novel 3D ultrasound, you have to be a female, be between eighteen and twenty-six weeks pregnant, and have at least some degree of disposable income. If that's not a finite market I don't know what is. A few months ago while our business was already undergoing its transformation, we received a phone call from a potential competitor who stated that they intended to open an elective 3D ultrasound center in our market. To be fair, they were returning a anonymous call we had placed to inquire about their pricing structure and service offerings. They just wanted us to know that they thought there was enough business out there for everyone, and wanted us to think of them as a partner as opposed to a competitor. Holly and I both got a good chuckle out of that...but under the circumstances, perhaps a belly laugh would have been more appropriate.