Macro environmental and industry analysis

Published by on October 5, 2020

Company: Waste Connections
https://www.wasteconnections.com
The task is POLITICAL/GOVERNMENT/LEGAL/REGULATORY ENVIRONMENT in part 1 Macro or general environment. Threat of Entry and Power of Suppliers in part 2 Industry analysis.
No introduction needed.

PART I MACRO OR GENERAL ENVIRONMENT

This section MUST:
    include a complete analysis of opportunities and threats captured by graphs, charts, tables of the industry in which your firm operates in the following 4 environments:
o    technological
o    economic
o    socio-cultural
o    political/government/legal/regulatory
    provide quantitative data for each trend analyzed charts, graphs, tables not words. All primary and secondary sources (including web sources) MUST be cited and sourced in footnotes – NOT endnotes
    identify each trend as an opportunity or threat

Important:
    Do NOT analyze the industry or the firm in the macro environment.
    Do NOT mention your firm in the MACRO as you are NOT analyzing your firm in this section
    Analyze the technological TRENDS disruptive innovation – that MAY IMPACT your industry if they are inputs to firms in the industry OR because they are substitutes that will eliminate the need for the products or services of your industry.
    USE data from the government agencies that produce the data Statistics Canada, US Bureau of Economic Analysis, US Bureau of Transportation Statistics
    Do NOT use data aggregators eg Statista, IBIS

Order of Analysis

Complete your analysis in the following order:
Political/legal Environment Trend Analysis O/T (opportunities and threats)

Note: There is a rough causality to the order above. An innovation in the technological environment stimulates entrepreneurs in the economic environment to exploit and commercialize the technology innovation. This, in turn, causes changes in the socio-cultural environment as consumers change their behavior by adopting it, and this finally triggers a response by elected officials and regulators in the political/legal environment who develop laws and regulations to deal with these changes and transformations.

1. POLITICAL/GOVERNMENT/LEGAL/REGULATORY ENVIRONMENT
4 pages, double spaced.

This section MUST:
    ID the MOST important federal or state or provincial government departments and agencies that regulate the industry of the firm that is being analyzed e.g. NR Can and National Energy Board are most important for oil and gas while DOT, NTSB are most important for airlines, railroad and trucking
    Do NOT analyze city or municipal by-laws far too many in Canada or US
    ID the industry association that represents the industry of your firm e.g. Canadian Bankers Association
    ID the issues the association identifies as the most important
    ID the most important relevant laws that specifically target and affect your industry of the selected firm.
    Do NOT analyze generic laws such as general taxation or copyright; only laws that specifically affect your industry (e.g., Bank Act for banking e.g. taxes imposed only on alcohol)
    evaluate each law or regulation as an opportunity or threat, and provide reasons for this judgment

Hint: Identify and review the industry association web site to see which issues the association identifies as most important
Read the Globe and Mail and the National Post.

PART 2 INDUSTRY ANALYSIS
In this section you MUST:
    complete an industry structural (NOT cyclical) analysis of the industry in which your firm competes
    structural = permanent change e.g. aging of the population, decline of birth rate, major technological innovation
    cyclical = the recurring economic changes relating to the seasons, the business cycle including interest rates, exchange rates and GDP
    provide empirical data for each TREND analyzed. All sources, primary and secondary (including web pages), MUST be cited and sourced
1.    Threat of Entry
3 pages, double spaced.

In this section, you MUST:
    identify and analyze any barriers facing potential entrants, including:
o    average capital investment needed to enter the industry
o    presence of strong brand names among existing firms
o    economies of scale (i.e., annual break-even point in units)
o    government regulation e.g. CRTC, Investment Canada Act
o    patents
    provide quantitative or empirical data when analyzing each barrier

Important: Do NOT title the heading Barriers to Entry. It is a Threat of Entry. You are examining and analyzing barriers to entry to determine the threat of entry.
low barriers to entry = high threat of entry
high barriers to entry = low threat of entry

2. Power of Suppliers
3 pages, double spaced.

In this section, you MUST:
    identify the AGGREGATE numbers of firms and revenues in the supplier industry
    analyze the availability of substitutes for the products supplied
    identify whether the supplier industry is concentrated or fragmented (i.e., less than 5 firms account for more than 50 percent of industry sales)
    determine whether suppliers are price takers or price makers