Industry Research Analysis Section 6.2 Fall 2016
Main Idea Studying a company’s industry and market helps an entrepreneur create a product or service that people want. Utilizing the Denver library resource provides students with an easy to use tool. Share out – What do you think of the first sentence? What does responsibly mean??
The students will be able to: Objectives 6.2 The students will be able to: Explain how to research an industry Utilize the Denver Library Database Each day go over the objectives with the students!!!!!
Vocabulary you need to know! Barriers to Entry Market positioning Economies of Scale Competitive Advantage Brand Loyalty Market Share Niche
Researching the Industry Trends and Patterns of Change Volatility – how quickly things change in the industry Rate of Sales growth Industry Forces that Affect your Business Industry Demographics The Competition
Industry forces Barriers to entry – conditions that make it difficult or expensive to enter a market to compete with established firm (s). Economies of Scale – cost of producing one unit of a good or service decreases as the volume of production increases. The bigger firms use this to their advantage and are able to have lower prices on goods or services. Brand Loyalty – loyalty to or tendency to buy a particular brand of a product – think Apple. Threats from Substitute products – most products have substitutes Economies of Scale – Could be in a manufacturing situation, restaurant or individual store. Think of Shirt off My Back in Breckenridge – opened in 1971 = now has 15 stores
Industry forces (cont.) Supply sources – can impact your costs, pricing and sales Ability to negotiate better prices – Large companies can do this and offer lower prices Smaller companies compete by offering personalized service and customized products Technology – can be used to improve business processes. Economies of Scale – Could be in a manufacturing situation, restaurant or individual store. Think of Shirt off My Back in Breckenridge – opened in 1971 = now has 15 stores
Industry Demographics Number of companies, annual revenues and average size of the companies by number of employees Can reveal the stability (or lack of stability) of an industry Library Research will be excellent source of information!
The Competition Market Share – portion of the total sales generated by all competing companies in a given market Niche – small, specialized segment of the market based on customer needs usually discovered during market research Market position – the act of identifying a specific market niche for a product or service Competitive Advantage – a feature that makes a product more desirable than its competitors’ product Never underestimate the competition! To succeed you must be able to capture market share by differentiating your business
Denver Library Resources for Industies ReferenceUSA – Company information Gale Business Insights: Essential – Industry & Company research, i.e. market share, profile, company history and more Key Industries in Colorado. Target Market for this web site are businesses thinking about relocating or expanding to Colorado. Highlights 14 different industries in Colorado – complete with detailed statistics! Created by the Colorado Office of Economic Development and International Trade (OEDIT)
You will need a Denver Library card!!!
Reference USA www.denverlibrary.org Research Popular Topics – Business Business Databases – ReferenceUSA Click on ReferenceUSA – Requires library card Video Tutorial
Business Insights www.denverlibrary.org Research Popular Topics – Business Business Databases Gale Business Insights: Essential Video Tutorial Click on Business Insights – Requires library card
Researching the Industry
Wendy’s – Main Page 1890?? That can’t be right! The company that now owns Wendy’s (Triarc Companies) traces its history back to 1884!
Information from the Main Page Total Revenue Employees and Sales Per Employee Competitors Industry Links Brands Company History Company Information Related Articles by Subject
Company Information – Rankings – Current Year Most are related to Adoptions – since that is a cause Wendy’s supports. Look at #5 – About all US Corporations!
How do we read these numbers?
Related Industries NAICS Codes can be used to group companies by industry. Similar to SIC Code. Click on link to find industry information.
Sometimes you have to dig! Current Restaurant Industry trends showed in April of 2015 - "Sales at restaurants and bars overtook spending at grocery stores in March for the first time ever” Keep digging for the reason!!