Guide to Economic Analysis

Use economic analysis tools to predict future growth for your company

By Lorraine Savage, freelance writer and editor, Athena's Scribe

1. Conduct economic analysis to evaluate risk factors, sales forecasts and regional and national markets.
2. Consult a strategic planner to set goals for your company’s growth and provide strategic scenarios over the next several years.
3. Hire a business analyst to develop synergy between management, technology and production to effectively implement the company’s goals.

Action Steps
The best contacts and resources to help you get it done

Apply economic analysis tools before new investments or construction

Before growing your business or considering new construction, consult an economic analysis company to help guide your way. These companies perform a cost-benefit analysis, which helps identify the projects that are more lucrative to implement and those that are better off rejected based on projected income verses expenditure associated with a proposed project. In addition, economic impact analysis can determine the effects of construction projects on the local economy and environment. Economic impact analysis can also provide documentation that can be presented to legislatures and the public.

I recommend: Check out the U.S. Department of Commerce’s Bureau of Economic Analysis. To learn more about economic impact analysis, visit the Economic Development Research and Training Center at Penn State. Reviewing the Introduction to Economic Analysis is a good way to learn more.

Consult a business analyst for advice on improving company performance

A business strategist will conduct an enterprise analysis to determine your company's strengths and weaknesses, provide advice on products and services, strengthen brand awareness, recommend management changes, improve human resources, offer ideas on organizational policy, direct corporate vision and update technology tools.

I recommend: Visit IconProcess and Moody Analytics economy website for enterprise analysis and business strategies.

Conduct a US economic analysis before expanding

Before launching a new product in the US, conduct a market analysis to identify the potential audience and its reception to the product. Perform a regional economic analysis to explore the current market, study its buying trends and preferences and examine the potential for new customers on a sustainable basis. A US business analysis of the market will help define exactly who will be buying your product and how often, determine if the market is saturated and develop an advertising strategy.

I recommend: For information on market analysis, visit Virtual Advisor Interactive. See the Free Management Library for strategic planning.

Helpful advice for making the most of this Guide

• •  Use economic base analysis to determine if the state of the local economy is stable enough to sustain your new business or new store locations.
• •  Don't be 'married' to your business plan if situations a few years down the line change. Be flexible and innovative!
• •  Stay current! Gauge the condition of the US economy and its effect on the global marketplace.