The first step to writing a Market Analysis is identifying the market and industry in which the Company falls under. Once this is determined, you must decide which industries and markets the Company is trying to target. For example, Company X offers water filtration systems for large bodies of water. Technically Company X is in the water filtration industry, however their target market will be different than a company who sells water filtration systems for residential faucets. Therefore, Company X is looking to target markets and industries which use large bodies of water, such as the aquamarine preservation industry or the fish farming industry.

Once this is determined, you are now ready to describe the environment in which the Company will be operating.Here are some examples of the sections which help describe the market’s environment:

  1. Target Market – This section should describe the groups (either individuals or businesses) who have a need for your product. In this section, you should answer the following questions:
    1. How many groups need your product?
    2. Does the main group breakdown into smaller segments? If yes, what are the segments?
    3. How large is your target market?
    4. How do you plan to capture this target market?
  2. Market Statistics – In this section, you should explain why this market and industry are good to go into. What has the success been of other companies who have tried to go into this market/industry? You should use charts and tables to show the success of the market you are trying to enter. For example, Company X mentioned above might like to show how much water the fish farming industry filters on a monthly basis or how large the fish farming industry is.
  3. Positional Requirements – The positional requirements should describe how the Company wants to be seen by the public and it’s target markets. For example, Company A sells furniture and all household needs. Company A wants to target building contractors. Company A can “position” itself as a one-stop-shop offering interior design counseling and all products which are necessary for designing a house from the wall paper to the bedroom set. The position a Company chooses should give it an edge in the market.
  4. Market Demand – This section should describe what the market demand is for your company’s product or services. It is important to back this information with figures, charts and tables.
  5. Competitive Landscape – This can actually be a stand alone section depending on the amount of information you were able to gather with regards to your competition. In this section, you should answer the following questions:
    1. Who is your direct competition? What do they do? How large are they? (It is good to site the competition’s website and any news articles if applicable)
    2. Which companies have the largest market share?
    3. Is there competitive pricing?
    4. What is the Company’s competitive advantage? How will the Company beat the competition?
  6. Investments in the Market – Are there already people investing in this market? Find statistics and figures which show that the Company’s market is worthwhile to invest in, and other feels that way also.

Overall, you want to ensure that your market analysis describes what is missing in the market that the Company plans to fill. It is recommeded to put figures, charts and tables describing the environment when you can.

Written by Shosh Pincus

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