Industry and competitors analysis is a market valuation tool aimed to give business knowledge of the complexity of a precise industry. It comprises studying economic, political and market influences that impact the growth of an industry. In understanding the industry one needs to look at certain factors that determine the trends, which plays an absolute command in the industry. These are the determinants of what should be produced, how much and the prices of selling the goods. The other side is analysis the industry regarding the barriers that can prevent the business from entering an already existing market. These can be factors such as government policies and opportunities available to run the business.
It is common to access factors that affect the success of the firm; the aim is always to make better decisions for the company's progress. Some of these are environmental trends; includes political and regulatory policies, this gets a lot of significance because they have a massive impact in the victory of the business. Economic factors that define the route in which the economy might move, the mentality of the society, the legislative alterations that take place from period to period and finally the climatic variations that can affect the business CITATION PES15 \l 1033 (PESTLE ANALYSIS CONTRIBUTOR, 2015)The market trends include; interest rates and the cost of outsourcing goods or services from other sources. Finally, five forces model; the five forces that influence and shape profit prospects. This looks through into the firm's competitors. These aspects are threat of new competitors, bargaining power of the merchants, bargaining power of consumers, risk of substitute products and the strength of competition among entrants CITATION Wil13 \l 1033 (Wilkinson, 2013)The profit margins of a business shrink by various factors that are brought about by increased completion and how common the precise product is to the market, a company can take a huge advantage of these slim margins. These factors include. The emerging industries, the establishment of an entirely new value chain - the high demands in technology and the business can grasp an opportunity and gains a lead and insurmountable marketplace position against all other competitors (first movers). Fragmented markets where no major firms drive the trend of the industry e.g. Starbucks, a company can choose to buy up businesses in the similar market and join them together to enjoy the economies of scale.
Mature industries, which has reached a state of equilibrium, it has no significant growth and lacks innovation e.g. groceries. Improving customer service and being efficient in delivery can give firm and advantage over others. Declining industries, where annual industry revenues decline steadily due to market saturation e.g. newspaper publishing. The businesses can find a niche and reduce or eliminate some investments and fund a new product. A global industry; this is the expansion of firms to an international market. A business can customize their products to fit and adapt to the different culture. Direct competitors, in which business are selling similar products, indirect competitors, where there are different products but the same target margin and finally potential competitors. In all these factors, a firm can position itself to be distinguished from others and gain an advantage in the industry.
There is a lot of miscellaneous information that involve in a business transaction; one should be cautious while selling or event is starting up a business. Take into considerations all the requirements, your distribution paths, key performance indicators, the rate in which consumer come among many others.
A successful entrepreneur needs to find a reason to kill the idea to find the perfect idea that can bring profit in the investment by eliminating most of the loopholes. There are lots of ideas in the industry but are feeble to succeed; ideas should be bold and innovative. An idea has no value at all; it value depends on how it is executed; if the notion is very impressive, but the execution is bad it becomes a total failure. Investors invest in the enforcement of ideas rather than the idea itself; therefore, an entrepreneur should invest a lot in the team that executes the concept into reality. Behind every idea, there is an urge to solve a detrimental issue in the society; an entrepreneur must be disturbed by a problem in the society I order to innovate a solution through, this model of finding a niche helps give the product an advantage in the market.
A true entrepreneur is open to other people in the related areas with his idea to gain criticism and constructive help towards marking it a success. These people can be from mentors, investors or other people in the related industry who have extensive knowledge or investment capital. They are paranoid, in that they focus on the weaknesses of the ideas; they are constantly looking into gaps that can kill the idea not the strengths of the idea. This helps in working an extra mile and making sure that the idea is strong enough to withstand all those factors that can undermine it. The entrepreneur look at the social impact the money factors in the idea, this is because the idea is bold and hence needs to attract venture capital CITATION Llu13 \l 1033 (Pareras, 2013)Conclusion, to success in a dynamic industry many things factors in, one needs to have an interest and acquire immense knowledge in the precise industry. This is by always searching for gaps in the business and its competitors to gain an advantage in the market. One should have passion, position themselves to the right target group, and be precise. Specializations is very vital in a competitive market, persistent is also key to succeeding, but also be respective or others decisions and finally promise what you can provide and avoid failing your clients since it can lead to failure,
BIBLIOGRAPHY \l 1033 Pareras, L. (2013, 4 29). 5 Keys to Success For Social Entrepreneurs: Lluis Pareras at TEDxBarcelonaChange. Retrieved 5 5, 2017, from TEDx Talks: https://www.youtube.com/watch?v=Pl8c5ooHfWs
PESTLE ANALYSIS CONTRIBUTOR. (2015, 2 23). WHAT IS ENVIRONMENTAL ANALYSIS? Retrieved 5 5, 2017, from PESTLE ANALYSIS: http://pestleanalysis.com/what-is-environmental-analysis/
Wilkinson, j. (2013, 7 24). Porters Five Forces of Competition. Retrieved 5 5, 2017, from Strategic CFO: https://strategiccfo.com/porters-five-forces-of-competition/
If you are the original author of this essay and no longer wish to have it published on the midtermguru.com website, please click below to request its removal:
- Marketing MIX for the Food and Business Industry in California Market - Paper Example
- Paper Example on Nature of the Operation and Product Portfolio of the Chosen Beverage Company
- Examination of the Plight Market in Nigeria - Paper Example
- Apples App Store Sees Record Sales - Article Summary and Discussion Paper Example
- Essay on the Article The Iron Cage Revisited by Dimaggio and Powell
- Mohammed Al Barwani Entrepreneur - Paper Example
- Market Research on Laptop Stands in the UK - Paper Example