This document discusses industry analysis and different tools used for analysis. It describes industry analysis as a method to understand a company's position relative to competitors and identify opportunities and threats. Three common analysis tools are discussed - Porter's Five Forces analysis examines competitive forces in an industry, PESTEL analysis evaluates political, economic, social, technological, environmental and legal factors, and SWOT analysis identifies internal strengths and weaknesses and external opportunities and threats. The document provides examples of factors considered in each tool and concludes that industry analysis helps companies set goals and evaluate competitors.

1. Industry Analysis
SEA COLLEGE OF ENGINEERING AND TECHNOLOGY
DEPARTMENT OF MBA
SUBMITTED BY : UMA MAHESHWARI S
SUBMITTED TO: DR NAGARAJAN SIR
PROFESSOR OF MBA DEPARTMENT
Date of assignment given:29-7-2022
Date of submission:9-8-2022
Remarks:

2. What is Industry Analysis?
Industry analysis, for an entrepreneur
or a company, is a method that helps to
understand a company’s position
relative to other participants in the
industry. It helps them to identify both
the opportunities and threats coming
their way and gives them a strong idea
of the present and future scenario of the
industry.

3. ADVANTAGES OF INDUSTRY
ANALYSIS
It helps you to evaluate the
profitability of the relevant industries.
Its focus is to point out the
opportunities and threats.
It helps you to touch the unexplored
opportunities.
Industry analysis helps the
entrepreneur to known about the
position of his company relative to the
competitors in the industry.

4. DISADVANTAGE OF
INDUSTRY ANALYSIS
Misinterpretation of the statistics and
data could lead you to make the wrong
decision.
Its one sided approach and it doesn’t
guarantee success.
if inflation decreases the sale and the
company’s revenue stream, it would
badly impact the report.
Season factors usually have a good and
bad impact on the business, if the
interpreter doesn’t consider these
factors, it would impact the conclusions.

5. Types of industry analysis
Porter’s Five Forces Analysis
PESTEL Analysis
SWOT analysis

6. Porter’s five forces industry analysis
 Porter’s five forces of analysis were developed in 1979
by Michael E porter of Harvard Business School as a
simple framework for assessing and evaluating the
competitive strength and position of a business
organization.
 Porter’s five forces help to identify where power lies in
a business situation. This is useful both in
understanding the strength of an organization’s current
competitive position, and the strength of a position that
an organization may look to move into.

7. Porter’s five forces are:-
1. Bargaining power of Supplier : An
assessment of how easy it is for suppliers to
drive up prices. This is driven by the: number of
suppliers of each essential input, uniqueness of
their product or service, relative size and
strength of the supplier and cost of switching
from one supplier to another.
2. Bargaining power of Buyer :An assessment of
how easy it is for buyers to drive prices down.
This is driven by the: number of buyers in the
market, importance of each individual buyer to
the organization and cost to the buyer of
switching from one supplier to another. If a
business has just a few powerful buyers, they are
often able to dictate terms.

8. 3. Competitive rivalry: The main driver is the number
and capability of competitors in the market. Many
competitors, offering undifferentiated products and
services, will reduce market attractiveness.
4. Threat of substitution(products and
services): Where close substitute products exist in a
market, it increases the likelihood of customers
switching to alternatives in response to price increases.
This reduces both the power of suppliers and the
attractiveness of the market.
5. Threat of new entry or barriers to entry: Profitable
markets attract new entrants, which erodes
profitability. Unless incumbents have strong and
durable barriers to entry, for example, patents,
economies of scale, capital requirements or government
policies, then profitability will decline to a competitive
rate

9. PESTEL ANALYSIS
A PESTEL analysis is a strategic
framework commonly used to evaluate
the business environment in which
operates. Traditionally, the framework
was referred to as a PEST analysis,
which was an acronym for Political,
economic, social, and technological.
Where the framework was extended to
include environmental and legal factors
as well

10.  Political factors include government policies,
leadership, and change, foreign trade policies,
internal political issues and trends, tax policy,
regulation and de-regulation trends.
 Economic factors include current and projected
economic growth, inflation and interest rates, job
growth and unemployment, labor costs, impact of
globalization; disposable income of consumers and
businesses, likely changes in the economic
environment.
 Social factors include demographics (age, gender,
race, family size) consumer attitudes, opinions, and
buying patterns, population growth rate and
employment patterns, socio-cultural changes,
ethnic and religious trends, living standards.

11. Technological factors affect marketing in
new ways of producing goods and services,
new ways of distributing goods and services,
new ways of communicating with target
markets.
Environmental factors are important due to
the increasing scarcity of raw materials,
pollution targets, doing business as an ethical
and sustainable company, carbon footprint
targets.
Legal factors include health and safety, equal
opportunities, advertising standards,
consumer rights and laws, product labeling
and product safety.

12. SWOT ANALYSIS
SWOT analysis is a strategic
planning and strategic
management technique used to help a
person or organization identify
Strengths, Weaknesses, Opportunities,
and Threats related
to business competition or project
planning. It is sometimes called
situational assessment or situational
analysis.

14. Internal factors
Strength (S) and weakness (W) refer to
internal factors , which are the resources
and experience readily available to you.
These are some commonly considered
internal factors:
o Financial resources
o Physical resources
o Human resources
o Trademarks, patents and copyrights.

15. External factors
Opportunity (O) and threat (T) refer to external
factors. External forces influence and affect
every company, organization and individual.
External factors are
o Market trends
o Economic trends
o Funding
o Demographics
o Relationship with suppliers and partners
o Political, environment and economic
regulations.

16. What are the biggest SWOT analysis mistake
 Making your lists too long. Ask yourself if your
ideas are feasible as you go along.
 Being vague. Be specific to provide more focus for
later discussions.
 Not seeing weaknesses. Be sure to ask customers
and colleagues what they experience in real life.
 Not thinking ahead. It's easy to come up with nice
ideas without taking them through to their logical
conclusion. Always consider their practical impact.
 Being unrealistic. Don't plan in detail for
opportunities that don't exist yet.
 Relying on SWOT Analysis alone. SWOT Analysis
is valuable. But when you use it alongside other
planning tools (SOAR, TOWS or PEST), the results
will be more vigorous.

17. CONCLUSION
Industry analysis can be done using various tools
and techniques. Industry analysis is a very
important business tool that helps companies to
set their own goals and evaluate the performance
of their competitors.
An industry is affected by internal factors like
management policies, supply chain policies etc
&external factors like political conditions,
business conditions etc. these factors can help in
determining future growth prospects as well as
success failure of various business related to an
industry