Industry Analysis of The Paper Industry

A common research paper assignment on an Industry Analysis of the Paper Industry is as follows:

It is critical to stress that this is a business report, and not an English paper. This is an MBA project. Following are the instructions for the entire paper. The entire outline is included to give you perspective on what should be included when writing an industry analysis.

Instructions for writing a research paper that is an Analysis of the Paper Industry:

1. Learning objective: to determine the opportunities and threats that exist for firms within a competitive environment.
2. Methodology: Apply an adapted model of Porter's (1980) five forces.
3. Student perspective and instructions: You are a team of analyst hired to answer a corporate-level question: should we enter this industry? You are outsiders looking in. In other words, when analyzing an industry, taking all factors into account, should we, as a corporate culture, enter this industry? The end result will be an understanding of what it takes to compete successfully.
4. Industry selection: Firm and industry selection are concurrent activities. Start with the firm. It must be publicly traded to give you access to an annual report and 10K, and it must have a definable problem. You are strongly advised to choose a firm with a production function, but exceptions are possible. Discuss with your instructor first. From your initial reading about the firm, what industries does it compete in? Make a choice of industry based on personal interest, firm problems, or in consultation with your instructor. The firm's primary source of revenue will in most cases define your industry choice.
5. Maintain your focus on the questions being asked. Provide conclusions for each section and sub-section. Note carefully the form of the conclusion provided in each section. A decision matrix should be provided at the end of each section, and an overall matrix provided in the conclusion section.
   Where quantitative analysis is required, provide average industry numbers expressed as ratios. Use five years of data to establish trends. Where qualitative analysis is required, provide citations to support your arguments. Assumptions and common knowledge are not accepted.

Industry Analysis of the Paper Industry Research Paper Outline:

I. Introduction

A. Description

B. Segments

C. Caveats

II. Socio-Economic

A. Relevant governmental or environmental factors, etc.

B. Economic indicators relevant for this industry

III. Porters Five Forces

A. Threat of New Entrants

1. Economies of scale

2. Working capital requirements

3. Proprietary product differences

4. Secret formula or processes

5. Absolute cost advantages: patents or copyrights

6. Brand identity

7. Access to distribution

8. Expected retaliation

B. Suppliers

1. Supplier concentration

2. Presence of substitute inputs

3. Differentiation of inputs

4. Importance of volume to supplier

5. Impact of inputs on cost or differentiation

6. Threat of forward or backward integration

7. Access to capital

8. Access to labor

C. Buyers

1. Buyer concentration versus industry concentration

2. Buyer switching costs

3. Buyer information

4. Threat of backward integration

5. Pull through

6. Brand identity of Buyers

7. Price sensitivity

8. Price to total purchases

D. Substitute Products

1. Relative price/performance relationship of substitutes

2. Buyer propensity to substitute

E. Rivalry

1. Degree of concentration and balance among competitors

2. Diversity among competitors

3. Industry growth rate (past & projected)

4. Fixed costs/value added

5. Intermittent overcapacity

6. Product differentiation

7. Growth of foreign competition

8. Corporate stakes

9. Exit barriers

IV. Conclusion

A. Critical Success Factors. At least three, two of which must be quantitative.

B. Prognosis - your assessment of the future of this industry. Summarize the five forces discussion. Threat, power, attractiveness. Should we enter this industry?

V. Bibliography

VI. Appendices
Industry Ratios
Other relevant indices