3. After going through this lesson, you are
expected to:
identify the different types of industries; and
distinguish the different products and services of the
business industries.
discuss industry and environmental analysis as a tool in
evaluating business opportunities;
apply SWOT analysis as a tool in evaluating a business
opportunity.
select business opportunities appropriate in your locality.
4. Businesses need to study various factors influencing
the business. Internal and external factors are needed to
be considered to identify business opportunities and
threats affecting the business.As you go through lesson,
you will learn about industry and environmental analysis
and apply one of the most widely used industry analysis-
the SWOT Analysis as a tool in evaluating a business
opportunity.
5. Activity 1: Pick three (3) businesses in your community and
interview the business owners about their business including the
opportunity and challenges they encounter in starting up their
business. Use the format below.
Name of
Business
Products/
Services Offered
Opportunity that
influenced in starting
the business
Challenges
encountered
1.
2.
3.
6. Industry and Environmental Analysis
In a book published by the Development
Academy of the Philippines, how to prepare
project feasibility studies, it includes an industry
analysis of the following important factors:
7. Competition- Who are your competitors in
the industry? What is the market share of these
businesses? It is very important that you know
your competitors and be ready for them.
Customers-Who will you sell your product
to? The target market must be identified. Who
exactly will buy your products?
8. Suppliers-Who are your suppliers, from whom
one can source raw materials, intermediate
products, or even finished goods one intends to
resell.A business may need one or more suppliers.
It is important to develop suppliers who are
reliable in terms of quality of what they supply and
their dependability in coming up with your order.
9. In short, Industry Analysis is
• a tool that facilitates a company's understanding of its position
relative to other companies that produce similar products or
services. Understanding the forces at work in the overall industry is
an important component of effective strategic planning.
• Industry analysis enables small business owners to identify the
threats and opportunities facing their businesses, and to focus their
resources on developing unique capabilities that could lead to a
competitive advantage.
10. Environmental Analysis
According to Robert Grant, author of “Contemporary
Strategy Analysis” an environmental analysis surveys the
business landscapes to determine how external variables will
affect its decision making.
• It is the careful study of various factors influencing the business. It
is the process by which organization monitor their relevant
environment to identify opportunities and threats affecting their
business.
11. •It helps to identify opportunities, to plan and to take
appropriate actions. It is the study of technological
factor, political factors, global factor and so on.
•By carefully analyzing the environment, the
businessmen come to know the opportunities
provided and threat posed by environment. Keeping in
view, its strengths and weakness, it can avail benefits
of available opportunities and face threats
12. Objectives of Environmental Analysis
1. To understand current and probable change in
environment. It is importance that one must be aware
of existing environment and changes in various factors
of environment like changes in economic, technological,
political, global environment, and so forth.
13. 2. To provide input for decision – making.
Decision – making means to select an alternate
among the various available alternates. In this process,
we need information for analyzing various alternates,
so that the best alternate is selected. Environmental
analysis provides such information to decision maker.
3. To ensure optimum utilization of resources.
The key of business success lies in the most effective
utilization of the company’s resources.
15. SWOT analysis can be carried out for a
product, place, industry, or person. It involves
specifying the objective of the business venture or
project and identifying internal and external factors
that are favorable and unfavorable to achieve that
objective
16. 1. Strengths – This pertains to the
characteristics of the business or project that gives
advantage over others. The primary technique for
identifying your business strengths involves
evaluating which operations actually make money.
17. 2. Weaknesses – A characteristic that place
the business or project at a disadvantage relative
to others. Identify weaknesses by finding parts of
your operation that cost you money.
18. 3. Opportunities – These are the elements that
the business or project could exploit to its
advantage. The technique for identifying
opportunities encompasses finding markets,
partnerships, products or services that you actually
can pursue.
19. 4. Threats – These are the elements in the
environment that could cause trouble for the
business or project. Owning a business means
facing risk. Use the technique of including only
threats that have direct impact currently on your
business or that seem as if they will impact you
and your business in the next five years.
20. Internal and External Factors of
SWOT
The internal factors are the strengths or as
weaknesses depending upon their effect on the
organization’s objectives. The factors may
include all of the 4Ps – price, product, promotion
and place; as well as personnel, finance,
manufacturing capabilities and so on.
21. The external factors may include
macroeconomic matters, technological change,
legislation, and socio-cultural changes, as well as
changes in the market – place or in competitive
position.
22. How to Use SWOT Analysis as a
Tool in Evaluating Business
Opportunity
Here are tips that will help you in using the SWOT Template
23. STRENGTHS
• Is the business in demand in your
community?
• Is it accessible to all?
• Will your community patronize
it?
OPPORTUNITIES
• Where are the good
opportunities facing you?
• What are the interesting trends
you are aware of?
• What are the external factors that
can increase profits?
WEAKNESSES
• What could you improve? Is the
product new in your community?
• What should you avoid?
• What factors would cause the
loss of your sales?
THREATS
• What obstacles do you face?
• What is your competitor doing
that you should be worried about?
• Could any of your weaknesses
threaten your business?
25. Activity: Identify the STRENGTH,
WEAKNESSES, OPPORTUNITY and THREATS.
Apply SWOT Analysis by using the SWOT
Template. Use the following listed words below.
26. a.Workers are well mannered, educated about books
b. Irrelevant location
c. E-books and e-readers eliminates needs for physical books
d. Manager has poor leadership skills
e. Visible on social media and customers can even shop online via their
website.
f. One stop shop for office and school supplies
g. Pandayan and Orchids Bookstore are their competitors
h. Competitors offer rewards points and discounts for students and
teachers
i. Partnership with international publishing house
j. Patronize by the booklovers and students
