Industry Trends: Key Highlights

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The purpose of this section is to highlight significant trends facing the industry. In theory, this section should not be necessary because the following section represents a more complete industry analysis, and everything listed on this page should be reflected in the following section.

In practice, however, this section is very useful for three reasons.

First, by listing only the most important industry trends, on one page, the big picture is not lost in the details.

Second, it is very easy for business managers, product managers, strategic planners, and every other member of the firm to contribute to the list of trends. The listing is easy to compile, easy to modify, and it serves as useful input to the next section.

Third, by isolating economic and technological trends from other industry trends, the process of communicating with other professionals in those disciplines is simplified. For example, in a large corporation with numerous business units and a centralized information systems department, the ability to read from and add to the list of information technology trends which impact the industry is an effective means for the information systems department to offer its expertise where it will have the most impact on the business.

When identifying economic and technological trends, it is important that the trends are, in fact, relevant to the business, and not just a general list of economic and technological trends. Long-term interest rates and image processing are both important, but not necessarily important to every business.

Examples of industry trends which affect the Mexican business forms industry include:

• Customer demand has been increasing as expectations for improved business conditions increase in the NAFTA era. Customers want a greater variety of choices, higher quality products and better service.
• Many business forms competitors are in a weak financial state, some near bankruptcy. In the last few years, most competitors have not been able to re-invest in new equipment.
• The industry is operating at only about 65% of capacity. Individual competitors, in order to boost volume and fill their own unused capacity, have engaged in destructive pricing, resulting in poor margins and below average returns for all industry competitors. Most competitors have not been able to raise prices over the last three years.

Examples of economic trends which affect the U.S. superstore industry include:

• The general health of the U.S. economy as measured by GNP is growing at 4%, increasing demand;
• Interest rates continue to be fairly low and stable which is important for internal growth and acquisitions;
• U.S. credit card interest rates continue to average a relatively high 17%, suppressing demand;
• The number of new start-up businesses in the U.S. grew by 6% last year which helped increase demand.

Examples of technology trends which significantly impact the global options software development industry:

• The number of option traders who use a PC connected to a LAN continues to grow;
• The amount of data and the number of financial data feeds that traders access continues to increase with advances in communications technology;
• Advances in multimedia technology have increased the use of multimedia in options training courses;
• New, faster chip designs and continued improvement in disk capacity continue to allow developers and users of option software to use more sophisticated formulas and greater amounts of historical data.

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Last modified:   Tuesday February 19, 2008