Industries and Markets

Business plans

Am I researching the right industry (NAICS Code)?

One of the key milestones in researching a business plan involves identifying the correct industry – or industries, as there may me many – to do some digging. This is important to understand your business idea, its business model and its industry. Here is a video I prepared about this:

A key success measure of this step involves identifying specific industry codes, such as the North American Industry Classification System (NAICS) Codes. These codes will speed up searching through value added databases licensed by your Library (such as these from Concordia University). Remember: you probably should identify the following industry (NAICS) codes, five (5) digit codes are optimal:

  1. The industry code in which your business “fits”
  2. Industry codes for businesses who pose substantial parallel competition (for example, 51511 Radio Broadcasting vs. 518210 – Data processing, hosting, and related services for music streaming)
  3. Industry codes for suppliers or buyers (if you are in a business-to-business setting) if they are substantially larger than you (which notes business risk based on market power). Looking up and down the supply chain is up to you.
  4. Any other industry code meaningful for your business, particularly those that may disrupt your business environment.

Now to the point: how do you know if you have the right industry codes? Well, this depends entirely on how much effort you are willing to put into researching your business project (arguably, the more codes you have, the more reading you will have to do) as well as, well, the fear of missing out (leaving an industry code “out” of the scope of your research means you run the risk of not getting your hands on key insight for your project). This is entirely up to you and I really can’t weigh in about this. Caveats aside, here are some simple advice to assist you in making your own mind as to which industry codes to pick and how many you need:

  1. Read the definitions of these codes from the Statistic Canada NAICS Codes page. This site sometimes include example activities and excluded activities (arguably, for some older versions of the codes, so the latest edition of the classification schedule may not have example or excluded activities).
  2. Read the IBIS World report for the Canadian industry (NAICS) code and look at the “About this industry — Supply Chain” section. When you access any specific report on IBIS, this is the section shown on the landing page of the Web interface (with the red dot & arrows). On te PDF report, it is located on page 2 – “similar industries” and their NAICS Codes are listed there.
  3. Use a business directory (e.g.: phone book) of small businesses, such as Mergent Intellect (formerly D&B Million Dollar Database) to look for specific companies, such as direct competitors. Industry codes are listed on the information page for a company in these systems. Remember – these directories may be wrong imprecise as companies may be misfiled by the analysts (or algorithms) filing companies in directories… but this is an interesting way to get feedback about the codes you’ve selected for your project.
  4. Search for articles for that specific industry (NAICS) Code – NOT GOOGLE. For example, you can use ProQuest Business Databases and type: NAICS 45391. You usually get articles and market reports on or about this code (sometimes you get a but of noise, but you can easily ignore this). Reading up on news for an industry codes is a great way to determine if this code is interesting or relevant for your project.

At the end of the day, it is up to you to determine if you have the correct industry (NAICS) code(s) and if you have enough of them.

Good luck!

Food

6.4 million Canadians limit the amount of meat they eat

Charlebois, Somogyi, Music, 2018, p. 37

Researchers at Dalhousie University released the preliminary results of a study of eating habits amongst Canadians. Titled:Plant-based dieting and meat attachment: Protein wars and the changing Canadian consumer (Charlebois, Somogyi, Music, 2018).

Interestingly:

Sixty-three per cent of respondents following a vegan diet—free from all animal-based products—were under the age of 38. Younger consumers are also less likely to believe that eating meat is a fundamental right. (from press release)

Statistics Canada does not currently compile statistics about vegans.

Screen capture of StatCan’s website for “vegan” on this page: “Does Statistics Canada collect this information?”

Digital media & ecommerce

Picking NAICS codes for digital technology business plans

One of the cornerstones of the business programs at Concordia University’s John Molson School of Business is entrepreneurship. Students have to perform advances industry and market research to write a business plan. I often have to assist them in determining the “main business” they are engaged in, specifically which industry code(s) to pick as the basis of their project.

Firstly, I like to point out that projects spanning multiple industries, markets, trends or technologies will probably have to pick a few codes, at least 2 or 3 of them. That is the only way to capture the complexity of disrupting an industry – by looking at a few angles.

Secondly, entrepreneurs researching a business plan will have to adapt existing reports and data to their unique idea. Dealing with imprecise information is not easy and simply looking for “perfect” information will usually not yield a comprehensive and authoritative project report. So, cast a slightly wider net and pick the best tidbits, rather than being too discriminating.

Thirdly, I have created a comprehensive 9-step research protocol for business plans, supported with 19 YouTube tutorial walk-through. I recommend that any entrepreneur go through this protocol to research their business idea.

Early in this process, entrepreneurs are asked to pick an industry code from the North American Industry Classification System (NAICS) to guide their exploration of many tools. These code have 2 to 6 digits, the more digits you have, the more precise the industry (say from “41” for “Wholesale Trade” to “419110” to “Business-to-business electronic markets”). Usually, having a 5 digit code is best.

A common problem entrepreneurs bring to me has to do with picking the right code for emerging technological fields. Here are the most common NAICS codes in the tech industry and how to navigate between them, drawing from a non-exhaustive list based on my experience:

335 Electrical equipment, appliance and component manufacturing
4541 Electronic shopping and mail-order houses
5112 Software publishers
5182 Data processing, hosting, and related services
5415 Computer systems design and related services
61142 Computer training
Concordia University Industries and Markets

Sources for Consumer Behaviour (MARK 305)

Here are some starting points for succeeding the final project at JMSB’s (Concordia University) MARK 305 Consumer Behavior course.

List of industries for the Fall 2018 semester:

  • Alcoholic Drinks
  • Apparel and Footwear
  • Beauty and Personal Care
  • Consumer Health
  • Fresh Food
  • Hot Drinks
  • Luxury Goods
  • Packaged Food
  • Pet Care
  • Soft Drinks
  • Consumer Foodservice
  • Travel

1. Consumer behavior trend analysis: Where do we find information about emerging trends in CB?

2. Industry/company analysis: size, key players, strategies

  • For this part, your librarian (me!) recommends the following databases listed on the Library’s Business Research Portal
    • Passport from Euromomnitor: this time, use the “industry reports” section to learn more about your industries
    • IBISWORLD reports: this system is in the “industry analysis” section of the Business Research Portal
    • ProQuest Business Databases: find articles by searching for the name of the trade associations, major players, industry name or consumer trend concept. Focus on articles from trade journals and academic/peer-reviewed/scholarly journals
  • Do you really think Google can help you with this one?

3. Consumer analysis: demographics, size of the target market and their consumption process (pre-during-post)

REMEMBER: Cite your sources! Use the citing business databases in APA format

Business plans

Researching business intelligence for new ventures

District 3 library research seminar handout

When launching a new business, information about industries, markets or competitors can be invaluable. In this session, we will cover resources from the Internet as well as licensed market and industry intelligence databases available from Concordia University Library. This is a workshop adapted from the “Entrepreneurship”  course at the John Molson School of Business.

Learning objectiveS

  • Locate industry and market reports from the Internet and the Library
  • Understand how to use datasets from Statistics Canada (Census & Cansim) and other national agencies
  • Develop a healthy information diet

Proposed Course Outline

1. Where does information come from?
It is imperative to use both licensed (library) and free web sources to have a complete picture.
2. Know your industry
3. Using Google for business research (governments & trade associations)
4. Statistics Canada for entrepreneurs (including SimplyMaps)
5. Reading up on your idea & staying up to date with articles
  • Think about your business idea when searching, use a variety of keywords:
    • (1) industry (use NAICS, watch out for jargon)
    • (2) trade associations
    • (3) market leaders and major competitors
    • (4) other subject term like a business trend
  • News and articles from ProQuest Business Databases and EBSCO’s Business Source Complete.
  • Setup an RSS feeds from ProQuest, EBSCO and Google to automatically receive notifications
We will use the Business Research Portal:
http://www.concordia.ca/library/guides/business.html
And this handout:
http://www.concordia.ca/content/dam/library/docs/research-guides/management/JMSB-LibraryOrientation.pdf
(We can discuss adapting these to the District3 website)
Business plans Information literacy

Quick & dirty outline of an intro to business research

Here is a draft outline I just created for a professor teaching an entrepreneurship class for Fine Arts students. Caveat being that these students are not business majors, so we have to spend more time explaining why each resource is useful and how to incorporate these sources in their assignments. Also, the bit about copyright is because they are Fine Arts students and the professor wanted me to cover this as well.
–> Please make sure students bring their devices or borrow laptops from the circulation desk to LB-322 <–
->Total duration: 150 minutes, which leaves room for a 15 minute break <-
1. Basic business & industry information
(20 min)
– Browse NAICS codes related to Fine Arts, enable students to discover their codes by engaging them to state their line of business
– Show the IBIS World system and present a sample report (uses NAICS codes)
– Show the SME Benchmarking system and a sample report (uses NAICS codes)
ACTIVITY: have students retrieve the IBIS World & SME Benchmarking reports. Troubleshoot NAICS codes & interface issues.
(15 minutes)
2. Basic market information
(15 minutes)
– Passport GMID
– PMB
ACTIVITY: Can you identify one trend or statistic that can impact your project from either source?
(10 minutes)
3. Stats Can
(15 minutes)
– Census: know your neighbours!
– CANSIM: Household spending & more
– Mention SimplyMap but do not show it
ACTIVITY: What is the average household spending for your product? How do you define your market (geography, demographics, etc.)?
(10 minutes)
4. Articles (trends, major players…)
(20 minutes)
– ProQuest
– Business Source Complete
ACTIVITY: Locate one article (news, trade or academic) which relates to your project.
(15 minutes)
5. Copyright
(10 minutes)
– What does copyright mean for you?
– Using copyrighted content as part of your work
ACTIVITY: Read the terms of use of Facebook with the class. Engage in conversation with them about what this means. Focus on when they post their own content on FB & when they post content from others (without their consent). Orient the conversation to the distinction between professional work versus academic or personal projects (ethics, values, rules).
(20 minutes)
Industries and Markets Reference

My advice for business research

Here is a paragraph I sent to a student trying to locate business information:

And please remember my motto about research: Search well and use what you find. Seeking out a little tidbit of information may be (and usually is) a waste of time. Take an hour or two, compile interesting sources from smart searching, and use what you find.

I often get questions about finding very specific (and often unrealistic) bits of information from students. Searching for business information is where students confront theories they learn in classes to the real world, sometimes theories just don’t fit with the data that’s out there!

Montréal Reference

Quick economic industrial survey of Montréal

Here are sources for finding information about Montréal’s economy and industrial make-up. I refer to subscriptions at Concordia University where I work.

– Passport GMID from Euromonitor
This is a system we have under subscription at the Library. It now provides top line reports of major cities around the world, including Montreal. Please access the system via this link:
http://clues.concordia.ca/record=e1001087~S0
(click on the database name and provide your netname if asked)
After accepting the terms of use of the system, just type Montreal in the search box on the top-right corner of the page. You will get many reports, but you are looking for the “Montreal City Review” in particular.
Video on using Passport: http://youtu.be/Wpotf4vcJmE?list=PLaqfn26UOsX-OJGT_W_UTOWzvAA5Kb3tG

– Montréal en statistiques
This city of Montréal website provides various reports about the city:
http://ville.montreal.qc.ca/portal/page?_pageid=6897,67633583&_dad=portal&_schema=PORTAL
In addition to the various reports, themes and other data available therein, I noticed this very recent economic portrait of the city:
Profils économiques : un portrait à jour de la dynamique économique montréalaise
http://ville.montreal.qc.ca/portal/page?_pageid=6897,68131631&_dad=portal&_schema=PORTAL&id=10396&ret=/pls/portal/url/page/mtl_stats_fr/rep_nouvelles/coll_nouvelles
Looks very interesting.

– Montréal International
This is the international development agency for the city. There are a lot of high-level glossy reports and data on this site, but in particular their publications:
http://www.montrealinternational.com/publications/
(This agency is one of the few I recommend you build a long-term, low volume but high impact relationship with)

– MEIE, Québec Government
The Ministère de l’économie has a portal devoted to each administrative region of the province, this is the Montréal page:
http://www.economie.gouv.qc.ca/pages-regionales/montreal/
Make sure you click around in the “Portrait régional” box, which is located on the bottom left-hand section of the page. You get a one or two page report for each theme.
(This agency is one of the few I recommend you build a long-term, low volume but high impact relationship with)

– Conference Board of Canada
I am sorry to report that we do ** not ** have access to the Conference Board of Canada’s e-library, but I did want to mention that they provide detailed forecasting reports at the city level.

Business plans Information literacy Reference

Flowchart for researching a Company or an Industry

Stumbled on this flowchart from Jenny Mueller-Alexander at Arizona State University Libraries about researching a single company or an industry.

I like how the company process splits into private company and public company – which has a huge impact on the amount of information available. Remember that anything a company tells you is either to their benefit, either required my law (like disclosing financial statements when their equity is traded on public markets of capital like stock exchanges).

I’ve been meaning to adapt my similar research protocol for business students to distinguish between researching a business idea (entrepreneurship) that targets consumers versus other companies. This also has great bearing on how one researches the information for a business plan… more on that later…