Market Sizing, Financial Analysis, and the UC B&E Library Resources

Special Topics Lecture

BA 5080

Fall Semester, 2012-2013

Presentation Outline1. Market Sizing

1. Defining a market niche

2. Finding “hard” data

3. Making assumptions

2. Financial Analysis1. Why it’s important

2. How to calculate ratios

3. UC B&E Library Resources1. Overview

2. Edgar & Hoover’s

3. Analyst report databases

4. News reports, books, & journal articles

5. Market sizing data

Market Sizing – Defining a Market Niche• Geographic scope

• Target customer profile

– Title/description– Revenues– Spending– Wants/needs

Market Sizing – Finding “hard” data

• Macro-level economic data is rarely exactly what you want – take what you can get

• Look for common demographic categories which are close to what you are looking for

• Remember to adjust the macro-level data in your assumptions

Market Sizing – Making Assumptions

• Assumptions based on “hard” data

• Assumptions based on anecdotal evidence

• Arbitrary assumptions based on “educated guesses”

Financial Analysis – Why It’s Important• Profitability Measures

– Important for understanding a company’s business model

• Liquidity Measures– Important for understanding a company’s ability to pay its bills

• Leverage Measures– Important for understanding a company’s actual “hard” value

• Activity Measures– Important for understanding when & how cash and products flow in/out of a company

• Other Measures– Important for understanding a company’s attractiveness for investors, its inner

workings, and deals and accounting practices which impact the company structurally

Financial Analysis – How to Calculate Ratios

• See “Guide to Case Analysis”, pp. 4-6.

B&E Library Resources - Overview• One of the top 10 Business & Economics libraries in the USA

• The main databases we are using in class are widely available to many of the companies you may end up working for

• Learning to navigate these databases quickly to find, “cherry pick”, and present value-added information is a skill set which is in demand by a wide variety of employers

• Listing this skill set on your resume, with the distinction of having acquired it by using UC’s B&E library, will differentiate you from other job candidates

• The more you surf around ALL the resources in UC’s B&E library, the more you will actually be able to “back up” this differentiation by recommending appropriate resources to your employer which are only available through UC B&E library

B&E Library ResourcesEdgar & Hoover’s

• Databases which are the starting points for any kind of market research

• Edgar gives you all the information you need to calculate financial ratios on companies

• Hoover’s gives you a standardized platform to use as a starting point for understanding the industry environment of a company

B&E Library ResourcesAnalyst Report Databases

• Databases which give you lots of value-added information from which to “cherry pick”

• Investext (Thomson One): Search on company, click on “Research” tab

• Datamonitor 360: Search on company, click on “Industries” tab, expand “Industries” list, choose most relevant industry

• IBISWorld: Search on NAICS code (2007), choose most relevant industry

• Mergent Industry Reports: Search on company, click on “Reports” tab, then “Industry Reports” tab, choose most relevant industry

B&E Library ResourcesNews, Book, & Journal Searches

• Search tools which allow you to scan vast selections of news reports, books, and journal articles for specific “nuggets” of information

• Factiva allows you to search news reports (make sure to use the “search form” screen)

• Summon, UC’s library search engine, allows you to search books and journal articles (make sure to use the “advanced search” screen)

B&E Library ResourcesMarket Sizing Data

• The UC B&E Library has a WIDE array of resources useful for finding “hard” data upon which to base market sizing estimates

• The “One Stop Business Research” page gives you a good overview of these resources, organized in useful categories

• Two good categories to start with are “Economic Data (US)” and Economic Data (World)”