Industry Analysis

How do I know if our idea is feasible? Summarize the industry in which proposed business will operate. Give relevant SIC / NAICS for the industry. How is the industry constructed/segmented? Discuss briefly industry size (in dollars) and annual growth rate (%); Where is the industry in its life cycle---emerging, early growth, rapid growth, early maturity, maturity, decline? How concentrated or fragmented is the industry? How many players are there, and how many are large versus small? Who are the largest and most important players in the industry? Highlight key trends in the industry. Are costs going down or up? What about prices? Discuss any new products or developments, and any other national or economic trends and factors that could affect the venture. Determine the key success factors for the industry. What are the winners able to do consistently that the losers or also-rans to not do? Any barriers to entry? 2

Sources On line websites Free or for fee Trade publications Library resources Current business owners 3

Hoovers Size Revenue Major Players Level of Fragmentation www.hoovers.com Size Revenue Major Players Level of Fragmentation Industry Segments What drives demand What are the factors for success Level of automation required Product / service categories How product/ service is created and/or delivered Type, location and level of technology Issues Fragmentation levels: highly fragmented to consolidated More fragmented the more companies Industry Segmentation: how is the competition defined 4

SBDC Net http://sbdcnet.org/ Provides links to national and international industry websites and publications Restaurants National Restaurant Association Pets National Association of Professional Pet Sitters PetGroomer.com 5

Census Bureau Determine NAICS Economic Census Data http://www.census.gov/ Determine NAICS Economic Census Data Table 1: Summary of Stats Table 2: Comparative Stats (1997 to 2002) Table 3: Product lines by Kinds of Businesses Table 4: Largest Firms Data: Number of establishments Revenue Payroll Number of Employees Metrics: Avg annual sales Avg employee cost Market trend Market segmentation Level of fragmentation 6

Zapdata Free statistical industry data Requires registration http://www.zapdata.com Free statistical industry data Requires registration 7

Assignment Develop a National Industry Analysis for your proposed industry. Answer the questions above based on available information Minimum info: SIC/NAICS Market Segmentation Industry Size Industry growth rate Key trends 8