Industry Analysis: Example, Tools & Free Template (2026)

You're planning a launch. The market looks big, and the growth chart looks good. But who controls access to customers? What makes them switch? And can you earn money after everyone else takes their share? This guide gives you a plain industry analysis definition, a worked example and a template to answer those questions.

Industry analysis examines how a group of competing businesses works and what affects its ability to earn a profit. It covers demand, competitors, buyers, suppliers, entry barriers and outside changes. You use it to decide where to compete, how to enter and which assumptions need testing before you commit money.

What is in an industry analysis?

An industry analysis covers the industry boundary, demand, competitors, routes to customers, costs and outside changes. It should explain what those findings mean for your business. An industry overview describes the setting. The analysis goes further: it tells you which conditions make an opportunity worth pursuing, and which could stop it working.

Start by separating the questions. A customer survey won't tell you everything about supplier power. A competitor list won't tell you why buyers stay with their current solution.

Industry research is the work of gathering evidence. Analysis is what you do with it. If your report could describe almost any business, narrow the scope. Raising money? The same analysis feeds your market opportunity slide.

What should an industry analysis template include?

A useful industry analysis template needs space for your conclusion, supporting evidence and unresolved questions. Start with the decision you're making. Then define the industry and record what you know about demand, competition and economics. Keep a source log alongside the report so another person can check how you reached the answer.

Use the table below as your outline. Replace each bracket with an answer. Write ‘unknown’ where evidence is missing, then assign someone to find it.

How do you do an industry analysis?

Start with the decision, then draw a clear boundary around the industry. Gather evidence about buyers, rivals and costs within that boundary. Check the important assumptions with people who buy or sell in the market. Compare your options, test a less favourable outcome and write down what would make you change course.

Define the industry before you count it

Say you sell appointment software. ‘Healthcare technology’ is too broad to explain your competition. Appointment software for independent clinics is a more useful starting point. Add a geography and a period. Then check whether buyers really see the products you've grouped together as alternatives.

Use Census NAICS to find official industry classifications for US data. A statistical category can help you find comparable records. It may still be broader than the businesses you actually compete with.

Build an evidence log

Record the claim, source, period, geography and definition together. Note whether the figure measures sales, businesses, establishments or customers. Those aren't interchangeable. Keep forecasts separate from observed results.

For the size calculation, use our guide to top-down and bottom-up market sizing. Bring its result into this report with the scope and assumptions attached. Then move on to whether you can reach those customers profitably.

Talk to buyers and people who control access

Ask buyers about their last purchase. Who approved it? What did they compare? What made switching difficult? Ask distributors and suppliers what they require before working with a new entrant. A channel that looks open on a website may work differently in practice. Our guide to market validation has 11 ways to test demand before you build.

Say you interview 6 clinic managers. Their answers can reveal buying obstacles. They don't establish how common those obstacles are across the industry. Record who you spoke to and look for evidence that challenges your first conclusion.

Compare options and test the weak assumption

Lay out the choices: sell directly, work through a partner, narrow the customer group or wait. Work out what each choice needs to succeed. Then change the assumption you trust least. If the recommendation flips, that assumption deserves more research before you spend. Our market entry strategy guide compares the main routes.

Which industry analysis tools and frameworks should you use?

Use Five Forces to examine competitive pressure and who can keep the profit. Use PESTEL to examine outside changes. Use SWOT to connect those findings to your own strengths and weaknesses. These industry analysis tools organise evidence. They don't supply it, and you don't need to fill every framework before making a useful decision.

How does Porter's Five Forces industry analysis work?

Five Forces looks beyond direct competitors to buyers, suppliers, substitutes and new entrants. Harvard Business School explains how these pressures shape the division of economic value. Ask which pressure matters most, and why.

For appointment software, another booking app may be a direct rival. A receptionist using a paper diary may be a substitute. The boundary matters. Don't count the same pressure twice just to fill the diagram.

Now a real industry. Take airlines. Travellers compare fares in seconds and switch over a few dollars. Two makers, Boeing and Airbus, build almost all large jets. An empty seat can't be sold tomorrow, so rivals cut prices to fill planes. Software sits at the other end. Once a team's data and habits live in a tool, switching is painful. And an extra copy costs almost nothing to make.

You can see it in profit. In Aswath Damodaran's January 2026 data for US companies, airlines keep about 5 cents of every sales dollar as operating profit. Software companies keep about 33.

PESTEL helps you ask what could change that picture. For each relevant change, write the chain of effects. A new requirement might add work for buyers, change product costs or delay entry. Verify the requirement at its official source before treating it as a constraint.

Use SWOT after that research. ‘Good product’ tells the reader very little. A demonstrated ability to connect with a buyer's existing system gives you something specific to test against competitors. Our guide to competitive moats shows how to turn that into an edge rivals can't copy.

Where can you find reliable industry research?

Start with official statistics and the organisations that produced the underlying evidence. Add company filings, trade sources and interviews to answer questions the datasets miss. Check the date, scope and method before using a number. When sources disagree, investigate what each one counts before deciding which fits your question.

Free government sources answer most "how many and how big" questions. Paid reports save time, but check what each one counts before you quote it. For survey and research software, see our comparison of market research tools.

A recent-looking page can still contain superseded data. In 2026, the Census e-commerce release page flagged its displayed estimates as no longer the most up to date. Follow revision notices before quoting a figure. Save the release date and the period measured in your evidence log.

When two reports disagree, first check geography, category and units. One might count software revenue; another might include consulting and installation. Don't average them. Choose the definition that matches your decision, or show separate ranges with their limits.

What does an industry analysis example look like?

A useful industry analysis example connects a market finding to an action. Below, a fictional appointment-software company compares direct entry with a partner route. The numbers are made up for the example. The point is to see which unknown changes the recommendation, then choose a test that resolves it.

Say you're considering appointment software for independent clinics in a new country. Your product works, but local onboarding would require extra support. You want to compare selling directly with using a partner. Start by writing what you still need to learn.

Now put the commercial assumptions beside each other. Revenue is what customers pay you. Contribution is revenue left after the variable costs shown. It still has to cover your other overhead. The table keeps those definitions visible.

Under these assumptions, the partner route leaves more money. But the partner's support promise is untested. If your team must do that work anyway, the result changes.

The recommendation is conditional: test the partner's support work before a wider launch. Measure the time your team still spends per customer. Then rerun the comparison with observed costs. Industry analysis helps you decide what to learn next, as well as where to enter.

A real example: distribution changed the recommendation

Our South Korean footwear market-entry case found that the brand was absent online and from specialist outlets. The analysis recommended changing the distribution partner. That finding changed the action from simply spending more on promotion to fixing how the brand reached customers.

How do you write an industry analysis report?

Lead with the decision and the evidence that supports it. Then explain the industry boundary, the pressures that matter and the assumptions still untested. In our work on market entry, the distribution finding shaped the recommended action. Your report should make that connection just as clear, with an owner for the next test.

Write the recommendation after doing the research, then put it first. A reader should be able to find your conclusion without hunting through pages of background. Put the detailed sources and calculations behind it. It works like the executive summary of a business plan.

1. Recommendation — state what to do, and the condition attached to it.
2. Evidence — explain the findings that changed your view. Link each claim to its source.
3. Alternatives — show what you compared and why you rejected the other options.
4. Uncertainty — identify the assumption most likely to reverse the choice.
5. Next action — name the test, its owner and the evidence needed to decide.

If the decision needs deeper buyer, competitor or channel research, our market research services can help. Our market entry team can then turn it into a launch plan. Bring the question you need to answer and the evidence you already have. That gives the work a useful starting point.