Whether developing a business plan or researching an existing business, industry information can help you make more informed decisions. Several online resources provide business data and reports on local, regional, provincial, and national levels.
Trade associations also provide free news and industry information in their newsletters and magazines. Many libraries have industry research databases.
SIC/NAICS Codes
SIC (Standard Industrial Classification) codes and NAICS (North American Industry Classification System) codes categorize companies by their industries. The codes are used to track business statistics and allow for standardized communication among businesses. These codes are crucial for businesses seeking government contracts, tax incentives, and networking opportunities. They are also important for tracking competitive trends and market size.
Originally developed in the 1930s, the SIC system was replaced with the more comprehensive NAICS in 1997. Developed by the Office of Management and Budget with cooperation from the Economic Classification Policy Committee, Statistics Canada, and Mexico’s Instituto Nacional de Estadística y Geografía, the NAICS has six digits that identify 99 subsectors, 312 industry groups, 713 industries, and 1,066 U.S. industries.
SIC and NAICS code lookup can be done manually by reviewing official SIC manuals or online resources, or it can be automated with API solutions that integrate the codes into workflows. To find your business’s code, start by identifying the primary product or service that makes up the majority of your revenue. Next, enter this information into an NAICS/SIC code lookup tool to receive a list of potential codes. If needed, you can use additional keywords to refine your search. Once you have a code, be sure to store it in your database so that you can easily reference it in future marketing efforts.
Industry Trends
Industry trends are prevailing developments that influence a business sector’s future direction. By monitoring these trends, businesses can identify potential growth opportunities and adapt their strategies accordingly. For example, if a trend indicates that consumers are increasingly seeking eco-friendly products, a company committed to sustainability can develop innovative solutions that address this need. In addition, if a trend indicates that the e-commerce industry is growing rapidly, a company can develop a robust online presence and invest in e-commerce technology to capitalize on this shift.
There are many types of industry trends, including technological, economic, and regulatory. Technological trends are driven by advancements in technology and can lead to new products, improved processes, and reshaped business models. Economic trends are influenced by changes in market conditions, such as inflation and unemployment rates, that can impact consumer spending habits. Regulatory trends are driven by changes in laws and regulations that affect business operations and compliance requirements.
By regularly reading industry publications and blogs, businesses can keep up with the latest technological trends. For example, Industry 4.0 trends such as the Internet of Things (IoT), artificial intelligence (AI), and machine learning, augmented reality, and robotic software development are currently shaping business processes and improving productivity. Keeping up with these trends allows businesses to make informed decisions about their acquisition strategy and position themselves for long-term success.
Market Size
Market size is an important factor for businesses to consider when evaluating opportunities and planning strategies. It indicates how much demand there is for a product or service and can influence various aspects of a business model, including customer segments, channel strategy, revenue streams, and growth potential.
Market sizing is a complex process that involves analyzing multiple factors, including market demographics and purchasing power. It is also influenced by industry trends, technological advancements, and economic conditions. To accurately measure market size, businesses should use a combination of secondary and primary research sources, such as government data, industry reports, and company financials.
One challenge to estimating market size is the availability of reliable data, particularly for new or niche markets. Inaccurate or outdated data can lead to inaccurate estimates, which may affect the effectiveness of a business’s marketing efforts and overall strategy. Additionally, obtaining accurate data can be costly and time-consuming, especially for small or new businesses.
To overcome these challenges, businesses should rely on data from credible and validated sources. They should also conduct their primary research, which can help them obtain unbiased and comprehensive information about their industry. Additionally, they should be cautious when using secondary research sources to avoid biased or incomplete information. Finally, they should carefully analyze their competitors’ products, pricing, and market share to gain insights into the competitive landscape and make informed decisions about their marketing strategies.
Market Share
Market share measures the percentage of a specific industry that your company’s products or services control. It’s calculated by dividing a company’s total sales revenue (or a good’s unit sales) by the industry’s total sales for a particular period.
When you’re assessing your own company’s standing in the industry, market share is an important metric to monitor. It can provide valuable insights into your company’s competitive positioning, growth opportunities, and marketing effectiveness.
In order to calculate market share, you must first identify a time period to examine, such as a fiscal quarter or 12 months. It’s also helpful to have the overall total sales of the industry you’re examining, which is often available on an online marketplace or in published market research reports. Next, divide your company’s sales revenue by the total industry sales and multiply by 100 to find your market share percentage.
Whether your company is in a rapidly growing or declining industry, it’s always important to understand the current state of the market and how it affects your business. When you know what your competitors are doing, you can learn from their strategies, adapt them to suit your own company’s needs, and potentially surpass them in the future. The best way to gain this understanding is through industrial information, which provides the data and analysis you need to connect the dots in your industry.