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Industry Background

$q,$ Industry Background

John

It may not be the biggest threat, but the threat from rivals is definitely a concern.

What makes the threat from rivals such a big deal?

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There's not much room to differentiate products in this industry.

$$ The industry is only growing at $1\mathrm{.}5\%$ per year.

$$ It's easy to exit the industry by selling off production or cancelling outsourced production.

$$ There are lots of competitors that are all pretty much the same.

$$ Outsourced manufacturing makes it easy for anyone to enter the industry.

Industry Background Facts

Industry is projected to grow at $1\mathrm{.}5\%/$year for th Lighting fixtures industry is roughly $$4$ billion wc Manufacturing

Mostly smaller manufacturers

Few, if any, manufacturers have a recogniz

Popular designs are rapidly copied

Patents offer little protection

Technology for internet$-$connected smart fi

Creating specialized production lines is nec Distribution Channels

Many smaller manufacturers sell directly thr Walmart

Some retailers offer their own private label bi

Large manufacturers sell directly through the

Individuals often compare prices across all ch Suppliers

Primary materials are commodities like metal,

Most manufacturers use a wide variety of supr

Each commodity has a large number of supplie

Startup Process

An efficient factory can cost between $$15-50m$

Outsourced manufacturing can reduce initial co

The regulations are simple and straightforward

Marketing expenditures can be controlled throus