megavideolinks
Joined: 19 Nov 2011
Posts: 273
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 Posted: Thu Nov 24, 2011 12:31 am Post subject: Dying Industries Face One or More Detrimental Trends |
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Of the 10 chosen industries, all generally exhibit one or more of the following detrimental factors. Industries and
companies that observe these conditions may be vulnerable to their own demise in the future. These factors include the
following:
• Damaging external competition
Particularly relevant to the manufacturing sector, major competition for items produced in the United States
comes from imported products, especially low-cost items. Since labor costs and regulations are high domestically,
many manufacturers send their production to foreign countries. Downward price pressure from domestic
wholesalers, retailers and consumers forces U.S. producers to cut costs in order to offer a competitive price.
American firms that cannot send their production activities out of the country face strong competition from imports;
therefore, these businesses often fail.
• Advancements in technology
While technological developments make life easier and more efficient, they often come at the demise of industries
that rely on the old ways of life. Technology change occurs rapidly within many industries across the United
States; as a result, it has spawned new industries and business opportunities. However, many traditional
industries struggle to keep up and ultimately lose out in this new wave.
• Industry stagnation
As competition becomes fiercer, due to the factors just mentioned, and other internal and external reasons,
businesses often need to cut costs in all production areas to reduce prices and garner sales. However, it comes
at the cost of implementing industry and product R&D. As a result, businesses often put off capital and technology
investments, making it more difficult to improve production efficiencies, which ultimately cost them time and
money. As a result of this vicious cycle, many industries end up stagnating and dying a slow death as others
catch up, overtake and prosper. Commercial Insights | Sales and Marketing – May 2011 | ABA Center for Commercial Lending & Business Banking | www.aba.com
Copyright 2011 – American Bankers Association, All Rights Reserved
Ranked in order of industry size at the end of 2010, the following table outlines the 10 dying industries. As indicated in the
table, over the past decade, each industry has experienced a severe drop in revenue and a significant decline in the
number of establishments. Additionally, these industries are also forecast to continue dwindling in size during the
foreseeable future. While these industries are all facing negative numbers, it does not necessarily mean that the players
that operate within them are also close to failing. Firms that protect their strength in certain market segments, focus on
niche opportunities and capitalize on a declining number of competitors can often reap the greatest rewards as sole
operators, obtaining market survival and profitability.
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manufactured home dealers
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