INDUSTRY
ANALYSIS
2
TOPIC OUTLINE
Industry analysis
Competitors
Customers
Substitutes
Suppliers
INDUSTRY ANALYSIS
Industry analysis involves the examination of various factors
that affect the feasibility and success of a business within a
given industry. Industry analysis helps business owners
identify market trends, competition, customers, and suppliers,
4
IN A BOOK PUBLISHED BY THE
DEVELOPMENT ACADEMY OF THE
PHILIPPINES ON HOW TO PREPARE
PROJECT FEASIBILITY STUDIES,
INDUSTRY ANALYSIS CONSISTS OF
DEPTH ANALYSIS OF THE FOLLOWING
IMPORTANT FACTORS:
COMPETITORS
What are the major businesses in the industry? Are their
locations close to your proposed business? Have they been
long existing or still new entrants? What is the market share
of each of these businesses? It is very important that you
know your competitors and be ready for them. Your aim is to
win over their customers, convince them to buy from you
instead, and remain as your loyal customers.
CUSTOMERS
Who will you sell your product to? The target market must be
identified-who exactly will buy your products, what income
groups, what age brackets, what gender, and what career
groups. What type of people will you cater to, based on their
preferences, lifestyles, and buying habits?
SUBSTITUTES
Substitutes are goods that can be used in place of another. These are goods that
may, even if partly, satisfy the same Needs of a consumer such that the consumer
may use one instead of the other. For example, margarine can be a substitute for
butter and wheat bread for white bread Some goods are close substitutes, while
others are not. Pepsi cola may be a very good substitute for Coca-Cola, but not
everybody will be willing to switch brands because they have developed taste for
a particular soft drink. This is why manufacturers try to differentiate their
products from their competitors so that the customers will develop product
loyalty for their brand. We know that Safeguard and Dove are both bath soaps,
yet we can distinguish one brand from another, and we have our own preferences.
SUPPLIERS
Every retail business needs suppliers from whom one can source raw
materials, Intermediate products, or even the finished goods one
intends to resell.
A business may need one or more suppliers. It is important to develop
suppliers who are reliable in terms of the quality of what they supply
and their dependability in coming up with the things you order from
the With modern technology, one can easily go online and shop for
suppliers or look at the reviews made by other retailers to determine
the reliable ones. The yellow pages of the telephone directories are also
good sources suppliers’ stores and names.
SUPPLIERS
The person intending to put up a business must ask around for
prices to be more Competitive with other sellers in the
market. A business owner can buy directly from the
manufacturers. This will be the cheapest source because there
are no middlemen involved. However, this is only
recommended if the supplier’s location is convenient and will
not involve expensive delivery costs.
THANK
YOU
Discussed by;
Jed Lora
