The Industry Analysis

Purpose of the Analysis Develop your secondary data research skills. Why? Effective B2B Marketing requires that you understand your –customers, –competitors, and –market trends. This understanding must be based on quality information.

Requirements 1.Pick an industry 2.Acquire specific information about the industry 3.Examine 1.The competition 2.The supply chain 3.The industry’s customers 4.Communicate your findings

Potential Information Sources General Encyclopedias U.S. Industrial Outlook NAICS Manual (or SIC) Standard and Poor’s Industry Survey Predicasts Basebook Annual Survey of Manufactures Ward’s Business Directory Market Share Reporter State/Regional Industrial Directories Corporate Annual Reports Industry-specific Trade Journals Continued on next slide

Potential Information Sources Beware the Internet!! Although it depends upon the industry you select, the vast majority of the information required may be accessed –In the Houston Cole Library –Via the Houston Cole Library’s electronic databases

Picking an Industry Must be (to a large degree) a B2B industry If you insist on a consumer product industry, you MUST analyze the B2B aspect, NOT the B2C aspect. Helps if you are interested in the industry Consider choosing a basic, well-defined industry Address each of the questions that follow In your introduction, clearly define your industry

Industry Specific Knowledge 1.What 3 historical events have shaped the development and growth of the industry? 2.What was the value of shipments for the U.S. in the latest year reported? 3.What are the values of imports and exports for the last 5 years? 4.What was the average annual growth rate over the last 3 years? 5.What is the forecasted annual growth rate of the industry? Continued on next slide

Industry Specific Knowledge 6.What are two other industry statistics that are important for your industry? Why are these important? 7.What is the most appropriate NAICS code for your industry? 8.Identify the industry’s trade association, if one exists.

Major Competitors 1.Who are the top 5 companies in the industry? 2.What are their most recent sales revenues? 3.Describe the industry leader (explain why it is the leader). 4.Describe potential competition arising outside the industry. 5.Why would any competitor outside the industry serve as potential competition?

Supply Chain The supply chain includes all organizations involved in the production, distribution, and sale of products. Upstream Suppliers Direct Suppliers ProducersIntermediaries Buyers

Supply Chain Describe the supply chain in the industry. 1.What type of suppliers provide the basic raw materials? 2.What type of suppliers provide component parts? 3.What type of manufacturers produce the finished product? 4.What type of intermediaries are involved in the distribution and/or sale of the product? 5.What other type of firms influence the supply chain in the industry? Continued on next slide

Supply Chain 6.What companies supply important inputs to the industry? 7.What products do they supply? 8.What major factors influence their ability to provide these products? Why?

Customers 1.What type of customers buy the products this industry produces? EACH 2.Describe the major buying processes used by EACH of these customer groups. o This includes their key buying criteria 3.How do the buyers use the products? Continued on next slide

Customers 4.Is it possible for the customers to produce the products themselves? –If yes, why? –If yes, why are they not now producing themselves? –If no, why? 5.Identify and describe the major customers for the industry’s products.

Communicate Findings The Report –Type and double-spaced. –12 point font, Times-New Roman –1 inch margins –Try to avoid exceeding 10 pages. ONLY –Cover page should ONLY include name of industry and your name. –Must be SECURELY bound in some way. In a manila folder is NOT securely bound –Put tables, graphs, charts, etc. at end –Page numbers required

Communicate Findings The Format –Cover Page Industry name & your name ONLY –Introduction Identify and describe the industry –Industry Specific Knowledge –Major Competition –Supply Chain Continued on next slide

Communicate Findings The Format –Customers –Conclusion Make a prediction regarding the future of the industry. Justify your prediction –References Follow Journal of Marketing format In-text citation Bingham and Gomes (2001) or (Bingham and Gomes 2001) Reference Section Bingham, Frank G., Jr. and Roger Gomes (2001), Business Marketing, 2 nd ed., Chicago, IL: NTC/Contemporary Publishing Group, Inc. Tables, Graphs, Charts, Etc.

Industry Analysis Grading Form Grading CriterionPerformanceWeightPts Earned Spelling, Grammar, etc Format Introduction Industry Specific Knowledge Completeness Industry Specific Knowledge Quality Major Competitors Completeness Major Competitors Quality Supply Chain Completeness Supply Chain Quality Customers Completeness Customers Quality Conclusion Was paper late? (10 point penalty per day)No0 TOTAL POINTS EARNED100