Rivalry among firms in the industry[ citation needed ] Industry cost structure[ edit ] The cost structure  is important for identifying key factors for success. The cost structure also is helpful for formulating strategies to develop a competitive advantage. For example, in some environments the experience curve effect can be used to develop a cost advantage over competitors.
For a small-business owner, market analysis refers to the process of obtaining information about customers, competitors and the industry in which the company operates. Market analysis is conducted to help entrepreneurs decide whether the market is large enough to justify taking the risk of starting the business.
Established companies conduct market analysis on an ongoing basis to shape the development of strategies to grow the company. Identifying a Market Need Companies succeed by supplying products and services that meet the current most-pressing needs and wants of customers.
A business owner must constantly monitor the market to identify when these needs change and adapt his product or service offering to be a better fit with these changed needs. A business owner can gather information about customer needs through conducting customer surveys and asking prospective customers what features of products or services are most important to them.
The market need could arise from a problem that customers seek to solve or a personal or professional goal they seek to achieve.
Defining a Market Opportunity A market need becomes an opportunity for the business owner if he can create and sell a superior solution for the need.
The company must have the capability to deliver its products and services at the high level of quality the customer expects.
The business owner must make a realistic assessment of what his company excels at in order to determine whether he can effectively compete in the market. Another way to define market opportunity is to identify where competitors are falling short of customer expectations and determine how your company can do better.
Look at the major competitors in your market and analyze their strengths and weaknesses in relation to yours. Industry trade organizations publish data on the current size and projected growth rates for their industries.
The National Restaurant Association, for example, publishes forecasts of restaurant revenue growth and analysis of industry trends. For consumer products and services, an effective way to analyze market size is to obtain information on demographic characteristics -- the populations of consumers in your area broken down by categories such as age and income level.
Census Bureau publishes demographic data on local communities. Choosing Target Markets Target markets are the groups most ready to buy your products or services -- the customer groups that have the most urgent need to purchase what you are offering. Narrowing the large overall market down to target markets is necessary, because target markets have different motivations for making purchases.
These purchase behaviors are referred to as psychographic characteristics.Company Summary. BUSINESS DESCRIPTION Cambridge Strategy Group is a North Carolina-based consulting firm that responds to entrepreneurs' need for practical business and marketing services to turn their innovative ideas into successful business ventures/5(68).
The market analysis section of your business plan comes after the products and services section and should provide a detailed overview of the industry you intend to sell your product or service in, including statistics to support your claims.
A SWOT analysis is most commonly used as part of a marketing plan, but it is also a good tool for general business strategizing, and to use as a starting point for team discussions. When conducted thoroughly, a SWOT analysis can uncover a wealth of information and can be .
Entrepreneurs running a small business may find SWOT analysis an immensely helpful tool.
A thorough and honest analysis of their business’ strengths, weaknesses, opportunities and threats can be of utmost importance. When budgets are tight, marketing might be the first expense you look to cut. Let me stop you right there. While traditional advertising methods are costly and hard to measure, small businesses have never had greater access to .
Sep 27, · If your business is quite small and you know your customers inside and out, a deep, formal market analysis might not be the best use of your time. For instance, if you are writing an internal business plan, meaning that you’re not going to use it to try to secure a loan or other funding, you may not have a specific reason to spend time reviewing industry data to corroborate your financial forecast/5(95).