How consultants do industry research

Management consultants need to be quick learners. Junior analysts are routinely asked to support proposals and projects across different industries. The good ones are fast, and proficient with Excel and PowerPoint. The great ones get up-to-speed quickly on the industry dynamics and can add in industry specifics to the pitch. If you are not proficient at industry research, you will not be a generalist consultant for long.

So what happens if a partner asks you to help on a proposal for something you know nothing about? For example, how do you get smart on commercials trucks?

1) Start with Standard and Poor’s (S&P) industry surveys

If you have access to these analyst reports through your work or university, start here. It is loaded up with charts, tables and graphs to get you up-to-speed on the major trends, value chain, competitors, key financial drivers and earnings.

2) Download SEC filings and investor presentations

After finding out who the main industry players are at www.finviz.com, go to to the investor relations section of the website. Download the 10-K and annual report. Also, download the presentations made to investors and Wall Street analysts; it is a treasure trove of information on the company’s strategy, and marketing.

Example #1: PACCAR:

From this example (company has since taken down the link) you can see that one manufacturer segments the customer base into six groups: 3 of them by size (large, medium, owner operator), 2 by ownership type (leasing vs. private fleet), and also the vocational segment.

Example #2: Navistar:

In this Q1 2012 earnings presentation, the management team shared their financial forecast, manufacturing strategy and market share by product type. In the slide below, it shows a worsening market share trend, so you probably want to also listen to the webcast, where management answers tough questions from analysts.

<<Flash forward 2019, please find Navistar investor relations presentations here>>

3) Search for industry trade organizations websites

Look at industry trade group websites to get a summary of trends, and regulatory issues. These groups do an excellent job of simplifying the story for non-experts. In the Google search box, simply add “site:org” to whatever search terms you use.

Here are some of the websites that came up from the search for “trucking” and “site:org”

4) Compare financial metrics

It always helps to compare the financials of different companies to see the 80/20 breakdown of revenue and profits for the industry. Finviz is a great tool, but so is SmartMoney. As you can see in the graphic below in gray color, Smart Money ranks the different companies by market capitalization, revenues, earnings, profit margin, dividends, ROA, ROE etc. See the example for Navistar (NAV) here.

5) Don’t forget about blogs and forums

If you are looking for more qualitative information, it is useful to spend 15-20 minutes looking at industry blogs. Just type in “blog” or “forum” with your targeted search term. Then search the specific topic on the blog. If is much better for you to learn the basics from an online blog community, rather than asking your client a question that shows your ignorance of the industry.

6) Look at Linkedin.com

Go to LinkedIn and see what current or previous employees are putting on their profiles and descriptions of projects. In the past, I did a market sizing from the tidbits that marketing managers mistakenly left on their LinkedIn profiles.

7) Prepare for primary research

There is only so much that you can get online. Think through your questions, then start reaching out to people you know via LinkedIn contacts or undergrad / grad school alumni. Sometimes a 30 min conversation with a subject matter expert is worth 3 days of online research. Potential interviews might be:

Suppliers or customers (up and down the value chain)
Distributors or dealership owners
Former employees
Industry researchers or professors

8-100)

There are so many other ways to do industry research, but you gotta start somewhere. Next steps might be: trade magazines, conferences, government and industry data sets, product reviews, surveys, focus groups, interviews. As a consultant, I have bought my fair share of – – – – for Dummies books. You will too.

P.S. One of my readers – Mark – suggested these websites for those interested in the trucking industry. Thanks Mark.

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8 Comments

Philip Siu on April 17, 2015 at 2:56 am

I love your posts! Please keep them coming. This is probably one of my first times commenting on any website. I would love to thank you in person over a coffee, if I had the opportunity!

consultantsmind on April 17, 2015 at 5:59 pm

Thanks for the compliment. I blog somewhat anonymously for now, so that might be tough. That said, let me know if there is anything I can help or advise with. Do great work, have fun, and keep learning.
- tgbenro on August 10, 2015 at 6:39 pm
  
  Hi. Do you blog anonymously because you still work or what? Just wondering! But the pieces you put out over the last 3/4 years have been great. Kudos!
  - consultantsmind on August 10, 2015 at 8:55 pm
    
    Yes, heh heh.

gabriella sollis on July 17, 2015 at 2:12 am

nice update

consultantsmind on July 17, 2015 at 6:35 am

Thanks for reading.

IQ4EQ on April 13, 2023 at 12:34 pm

Thanks for listing the places to look for info. But the challenge is there is so much info out there, and it can get overwhelming and lost.
From what I learned from you and other places, we need to first come up with questions and hypotheses, and second have a model framework to bucket the info.
But still, this is a challenging process, can you give some examples?

Consultant's Mind on April 20, 2023 at 9:37 pm

I think that’s fair. It’s a continuous process of opening up the problem (what else is important, what are upstream influences / downstream impacts, who are the stakeholders, what is my time frame?) and closing down to solutions (what does the data say, what data is available, what confidence level do I need, what did the client say the last time I spoke with them?)

Philip Siu on April 17, 2015 at 2:56 am

I love your posts! Please keep them coming. This is probably one of my first times commenting on any website. I would love to thank you in person over a coffee, if I had the opportunity!
- consultantsmind on April 17, 2015 at 5:59 pm
  
  Thanks for the compliment. I blog somewhat anonymously for now, so that might be tough. That said, let me know if there is anything I can help or advise with. Do great work, have fun, and keep learning.
  - tgbenro on August 10, 2015 at 6:39 pm
    
    Hi. Do you blog anonymously because you still work or what? Just wondering! But the pieces you put out over the last 3/4 years have been great. Kudos!
    - consultantsmind on August 10, 2015 at 8:55 pm
      
      Yes, heh heh.
gabriella sollis on July 17, 2015 at 2:12 am

nice update
- consultantsmind on July 17, 2015 at 6:35 am
  
  Thanks for reading.
IQ4EQ on April 13, 2023 at 12:34 pm

Thanks for listing the places to look for info. But the challenge is there is so much info out there, and it can get overwhelming and lost.
From what I learned from you and other places, we need to first come up with questions and hypotheses, and second have a model framework to bucket the info.
But still, this is a challenging process, can you give some examples?
- Consultant's Mind on April 20, 2023 at 9:37 pm
  
  I think that’s fair. It’s a continuous process of opening up the problem (what else is important, what are upstream influences / downstream impacts, who are the stakeholders, what is my time frame?) and closing down to solutions (what does the data say, what data is available, what confidence level do I need, what did the client say the last time I spoke with them?)