Competition Components

The Competition Components worksheet is divided into five sections. Each section is explained below.

Competition Components

Follow these steps for each risk factor:

Enter the negative and positive responses for the risk factor in the columns labeled "Negative" and "Positive". The worksheet will calculate the risk for the factor based on the responses and display the result in the column labeled "Calculated Risk".

Evaluate the risk calculated by the worksheet. Does it seem appropriate to you? Decide what seems to be the appropriate risk for the factor based on the worksheet's calculation and your own analysis.

Enter the risk you want to assign to the factor in the column labeled "Selected Risk".

Relative Size of Company

Complete these steps:

Enter the number of employees the business has, its total assets, and its total sales. The worksheet will calculate a risk for each factor.

Evaluate the risks calculated by the worksheet. Do they seem appropriate to you? Decide what seems to be the appropriate risk for each factor based on the worksheet's calculation and your own analysis.

Enter a total risk for these factors in the cell labeled "Selected Risk". You can average the risk for the three factors, or you can weight the factors. For example, if you feel that sales size is the most important risk factor for this industry, you can weight its risk higher than the risks for number of employees and asset size.

Market Size and Share

The input grid for the Market Size and Share risk factors is designed to capture market data from a state sales tax report.

Obtain the state sales tax report for the subject business's state and SIC code. These reports are available from the state's tax authority.

Enter the gross sales and reporting outlets data from the report. The worksheet will calculate growth and other analyses and statistics from the data.

Use the data and the worksheet's calculations to determine a total risk for market size and share. Enter this value in the cell labeled "Risk Selected".

Market Strength - Competition

The Market Strength - Competition risk factors measures the company's ability to grow in the current environment, and the company's adaptability. Enter a value that captures those risks.

Other

Use the Other risk factors grid to calculate a risk for any relevant competition factors that are not specified elsewhere in the Competition Components worksheet.

Enter a description and a risk for each factor.

Enter a total risk for these factors in the cell labeled "Risk Selected".