what is the average size of a company in the industry?

What is the average size of a company in the industry?

Objectives• Examine industry structure, with a focus on

company size, in the context of entrepreneurial industry status

• Explore the impact of average company size on your success as an entrepreneur

MacroeconomicChange

Entrepreneurial Motivation

Entrepreneurial Behavior

Industry

Condition

IndustryStatus

Industry lifecycle

Industry structure

Opportunity Identification

ValueCurve

Competition

The Opportunity Analysis CanvasTM

Entrepreneurial Mindset

Defining company size

“the average size of companies (employees, resources, etc.) within an industry”

• Capital intensity• Advertising intensity• Company concentration• Average company size

The “ideal” competitor size• Industries with a small number of small-

sized competitors present the preferred scenario for new ventures

• Competing with a few small competitors is more advantageous for entrepreneurs versus competing with many large competitors

Ways to grow bigger faster cheaper• Outsource

– Not always offshoring– Legal, accounting, technology, marketing, etc.

• Partnership– Share in the risks and rewards

• Joint venture– Formal, on-going partnerships

Summary on industry status• New ventures perform better in younger

industries with immature industry structures– Less competition versus established industries– Capital intensity and advertising intensity are

often low in young industries, and it is affordable for new entrants to enter and compete effectively

• Young industries also offer a common learning curve amongst all competitors, and a more even playing field for competition