Part 1

Past and Future Growth of Your Industry

If y our b usin ess p la n ’s fi gure s a re f a r o ut o f l in e w ith i n dustr y a v era g es, y ou n eed t o e x pla in i n y our p la n h ow y ou a cco unt f o r

th e v aria tio n.

I n dustr y M atu rit y

In dustr ie s d o n’t re m ain s ta tic ; th ey m ay c h an ge d ra m atic ally o ver tim e. G en era lly , th e lif e c y cle o f a n in dustr y c o m pris e s fo ur

phase s: 1 ) n ew , 2 ) e x pan din g, 3 ) s ta b le , a n d 4 ) d eclin in g. T he la st p hase , d eclin e, is n ot in ev ita b le ; m an y lo ng-s ta n din g, s ta b le

in dustr ie s s h ow n o s ig n o f d eclin e.

In dustr ie s h av e d is tin ct a ttr ib ute s in d if f e re n t s ta g es o f m atu rity . E ven in dustr ie s th at s e em c lo se ly r e la te d a re q uite d is sim ila r

b ase d o n th eir d ev elo pm en t s ta g e. F or in sta n ce , th e s o ft d rin k in dustr y is r e la tiv ely s ta b le , a n d a f e w m ajo r c o m pan ie s d om in ate

th e fi eld . L ittle r o om e x is ts f o r n ew co m ers , a n d it w ould b e e x tr e m ely e x pen siv e to tr y to c o m pete . O n th e o th er h an d, th e n ew er

b ottle d w ate r i n dustr y h as l o ts o f c o m petitio n a n d v aria tio n.

T he I n du str y M atu rity C hart o n p age 9 0 d esc rib es c h ara cte ris tic s o f in du str ie s in th e fo u r d if f e re n t s ta ges. E xam in e th e

ch art a n d th e d esc rip tio n s o f th e g ro w th s ta ges, th en lis t th e m atu rity c h ara cte ris tic s o f y o u r in du str y a n d th e o pportu nitie s

a n d r is k s t h ey r e p re se n t o n t h e w ork sh eet o n p age 8 9.