Definition and Types of Industries

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@QuaintTinWhistle

Study Notes

An industry is a group of companies or organizations that produce goods or services that are related or similar.
Industries can be categorized into different types, including:
- Primary industries: extract and process natural resources, such as agriculture, mining, and forestry.
- Secondary industries: manufacture and process goods, such as construction, manufacturing, and energy production.
- Tertiary industries: provide services, such as healthcare, finance, and tourism.

Introduction: new industry emerges, growth is slow, and profit margins are low.
Growth: industry expands, growth accelerates, and profit margins increase.
Maturity: industry reaches saturation point, growth slows, and profit margins stabilize.
Decline: industry experiences decline, growth slows, and profit margins decrease.

Industry structure refers to the characteristics of an industry, including:
- Barriers to entry: factors that prevent new companies from entering an industry.
- Concentration ratio: percentage of market share held by top firms in an industry.
- Degree of rivalry: intensity of competition among firms in an industry.

Industry analysis involves examining an industry's structure, trends, and outlook to understand its attractiveness and potential for profitability.
Key factors to analyze include:
- Market size and growth rate
- Competitive landscape
- Customer needs and preferences
- Technological advancements and innovations

An industry is a group of companies or organizations that produce goods or services that are related or similar.
Industries can be categorized into three main types:
- Primary industries: extract and process natural resources, such as agriculture, mining, and forestry.
- Secondary industries: manufacture and process goods, such as construction, manufacturing, and energy production.
- Tertiary industries: provide services, such as healthcare, finance, and tourism.

The industry life cycle consists of four stages:
- Introduction: new industry emerges, growth is slow, and profit margins are low.
- Growth: industry expands, growth accelerates, and profit margins increase.
- Maturity: industry reaches saturation point, growth slows, and profit margins stabilize.
- Decline: industry experiences decline, growth slows, and profit margins decrease.

Industry structure refers to the characteristics of an industry, including:
- Barriers to entry: factors that prevent new companies from entering an industry.
- Concentration ratio: percentage of market share held by top firms in an industry.
- Degree of rivalry: intensity of competition among firms in an industry.

Industry analysis involves examining an industry's structure, trends, and outlook to understand its attractiveness and potential for profitability.
Key factors to analyze include:
- Market size and growth rate.
- Competitive landscape.
- Customer needs and preferences.
- Technological advancements and innovations.