THE next time you are in Newcastle upon Tyne or Gateshead, it might pay to take a closer look at the products on sale in the shops. Northeast England is often used as a testing ground by big companies to try out new products before deciding whether to launch them nationwide.

So if bright pink legwarmers seem to be flying off the shelves in Whitley Bay, it may not be long before we are all wearing them.

Experience shows that if you can spot a trend in the market and get your products out there quickly, the rewards can be immense. And the good news is that small- or medium-sized firms are often able to move faster than the big companies.

So how do you spot a trend? David Lewis, who runs the marketing consultancy Neurinx 2, said: “The secret of success is to find out exactly what is going on in the marketplace. You can’t do it from behind a desk: you need to get out there and listen to people.

“Big companies employ cool hunters to find out what is going on. If a firm makes trendy clothes for young people, for example, the cool hunter will go round the clubs the young people go to. Owners of small businesses have to be their own cool hunters.”

Lewis said that to work out what potential customers are thinking, you need to do what they do: read the same magazines, join the same clubs and visit the same places whether they are art-school exhibitions or Ibizan clubs.

Once you have identified a trend, said Lewis, the next step is to get your timing right. Move too early, and you could find yourself paying for development and marketing costs from which other companies will reap the benefit. Move too late, and you could find that the margins on the product have been squeezed so tight by the competition that it is impossible to make a profit.

The secret for small companies, he said, was to be second into the market: “Let someone else do the spadework and spend the money to establish the product in the market. Then move in as fast as you can while there is still margin in the product, cash in, and get out when the trend starts to turn down.”

A few people purchased mobile phones when they were launched at a cost of £2,000 and were the size of house bricks, he said, but most people waited until the size and price had come down before buying one.

New products are not the only ones that have the power to set market trends. Many products that have been selling in modest numbers for years may start flying off the shelves because they are deemed to be the “next big thing”.

Lewis said: “Hush Puppies were seen as boring shoes for middle-aged men. Then a cool hunter in Greenwich Village noticed that young kids were buying them and soon they beame a hot fashion accessory.”

The secret for small firms, said Lewis, was to take a second look at what you had on your shelves. “There may be something that didn’t sell five years ago because it was ahead of its time. Maybe if it was painted yellow, or if you found a new way of promoting it, it would sell.”

Simon Dunn is the director of Product Chain, a co-ordinator between manufacturers and supermarkets. He agreed that trends could emerge from existing products just as easily as new ones. “A lot of new concepts are just reinventions of old ideas.”

A prime example of reinventing something old, said Dunn, was Ovaltine. The drink is made of the same ingredients as the inside of Maltesers. So Mars simply relaunched Ovaltine as a Malteser soft drink.

“It has taken something that lots of people haven’t consumed for years, given it an interesting pack and just put it back on the market.”

To get a feel of what is about to become fashionable again, Dunn simply keeps his ears and eyes open.

“I talk to my wife’s friends and interrogate them. Then I go to America at least once a year, and I go to trade shows. Companies could do this but they don’t divert the resources for it.”

Rachel Bridge