If setting up your own business in on your mind, you will perhaps need the help of investors or banks. In order to persuade banks or investors to fund your business, you will need to explain them thoroughly the nature of your business, your plans, mission and vision. For this, you need to have a vast knowledge about your business industry, without which it would be difficult to get the help of investors or banks. Whether your business is about retailing, manufacturing, service business, or any other form, you need to do an industry analysis to get a fair idea of your business industry.
Â Industry Analysis helps you to know Customer Preferences
Â An industry analysis mainly involves the analysis of the industry participants, distribution patterns, buying and competition patterns.
What is an Industry Analysis?
Everything that happens in your industry, even the things happening outside your business, has an effect on your company. To make things work for your company, and also to protect it from uncertainties, you need to know as much as possible, about your business industry. The analysis of each and every occurrence in your industry is referred to as industry analysis.
The economics of general business, competition factors, distribution patterns and participants are discussed by a business plan. The other things discuss the nature of your business to the outsiders.
With the emergence of the internet, retrieving business information is no more a problem. To construct a business plan, you can seek help from websites related to trade associations, demographics, financial statistics, business analysis and many more.
You need to be informed about the other sellers in your market. As a matter of fact, a business can be well described by describing its participants. For example, there is a lot of difference between the industry of broadband television services and that of dry cleaning. The former has a few participants in one country, in the form of huge companies. The later has a large number of smaller participants.
This factor can create a big difference in a business plan and a business. As said be economists, consolidation in industry is a time, when a large number of small participants disappear, with the emergence of a few large participants. For example, in accounting, there are a few renowned large international firms, along with the presence of numerous small firms.
There are many paths to be followed by services and products, between users and suppliers. You need to know the process of distribution working in your industry. You need to know whether or not your industry sells directly to customers of large industries. You must also be aware of whether the sales force is supported directly by their manufacturer, or the manufacturers work with representatives of product.
Buying and Competition Patterns:
Competition in market is a crucial factor to understand. You need to know the reasons behind the customers giving preference to one provider over the others. You need to know the factors responsible for this preference- is it the service, product features, price, software, brand name, delivery date or support.
Careful analysis of the industry will help you to know your industry better. This would also help you to take right steps at the right time to improve your company.
Alex Mathew is a proficient author writing articles on Business Industry and other similar topics. He contributes regularly for Ecoex-Odourcontrol.com.au.
Description: A good knowledge about your business industry is a pre-requisite to setting up of an efficient business, and also to avail the help of banks and investors.