Entrepreneurs have to closely monitor and analyze the industry, competition, target markets and most importantly, existing and potential customers in the market, and constantly adapt their competitive positions within the framework of the findings, before they start their venture processes and essentially at all stages of the entrepreneurship process. Competition is essentially a learning process. Businesses also have to closely monitor the close and distant environmental conditions and the characteristics of the competitive environment they are in, the advantages and disadvantages compared to their competitors and their competitors, as well as the market and customers, to anticipate the expected and expected changes in these elements on time and to reveal the necessary changes. Entrepreneurs who can present this change in the most effective way, in other words learn more accurately and faster than their competitors, will be much more successful in the competitive environment. In this section, we will focus on industry (sector) and competition analysis from the immediate environment. In the next section, we will talk about customer analysis and demand forecasting. At this point, it is useful to underline the difference between industry and market concepts. The concept of industry is a concept used to express the total of businesses operating with similar production processes and products. The concept of market, on the other hand, is the name given to the sum of customers who create demand with similar needs and preferences in a defined region. Within a given industry or sector, there can be many different markets that are differently defined. In addition, companies competing in the industry can reveal different market definitions in line with their unique analysis and needs. Analyzes related to understanding the competition and customers that we will discuss in this section can be done at the industry level or separately for each defined market. Since each market will have its own unique conditions, it would be more appropriate to make such analyzes separately for each defined market in which entrepreneurs plan to compete.

As a result, whether it is carried out at the industrial level or within a more specifically defined market, the main purpose is that the entrepreneur knows closely the factors that characterize and directly affect the competitive environment and manages the enterprise process accordingly. There are many parameters related to industry and market conditions that need to be taken into account when analyzing the competitive environment. Harvard University faculty member Michael Porter classified these factors under five main groups. We will start our discussion by considering these five main factors and we will continue by gradually deepening.

2.1. Industry's Five Factor Analysis

One of the important issues to be considered when analyzing the competition and business conditions in a particular industry or market is that no entrepreneur can manage business processes alone and must work with different actors in the industry. Similarly, some other actors in the industry are in a position to seriously affect the business processes of entrepreneurs and their results with their decisions and activities. The Five Factor Analysis of the Industry sets out with this point of view and tries to reveal the conditions of business and competition in the industry by focusing on the qualities of the relations with these different industry actors in the value production processes, while carrying out the activities of the enterprises. Five critical industry actors focused in this sense emerge as (1) Customers, (2) Competitors, (3) Suppliers, (4) Manufacturers of substitute products, and (5) New companies that can enter the market. In the following sections, a feasible framework for industry analysis will be introduced by focusing on the possible effects of these actors and the quality of their relations with these actors on the business processes and performance of the focus entrepreneur firm.

2.1.1. Bargaining Power of Suppliers

Every enterprise has to work with a variety of suppliers while running its own value generation processes. Raw materials, finished products and semi-finished products, energy, machinery-equipment, various services that may have a direct or indirect effect on the product of the enterprise and many similar inputs must be provided from suppliers. The performance of the suppliers and the relations with the suppliers are of great importance in order for the enterprise to proceed in a smooth and successful process and to maintain its competitive power. It is desirable from suppliers to meet the expectations of the enterprise in the procurement processes, to deliver their deliveries in a timely and error-free manner, and to put forward reasonable price demands while doing all of these. However, it is common for enterprises to encounter the opposite of the desired supplier behavior as stated when dealing with suppliers. Contrary to expectations, there are many entrepreneurs who demand higher than normal prices whenever they find the opportunity or have to do business with suppliers who refrain from demonstrating the desired performance quality in their procurement processes. Unfortunately, businesses that have such supply relationships are faced with great difficulties.

One of the important findings of years of market observations and research on procurement processes is the fact that there is a strong relationship between the bargaining power of supplier companies and their tendency to prefer undesirable behaviors in procurement processes. The more strongly the supplier companies feel in their mutual relations with the entrepreneurial firm, the more they become interested in their own interests rather than winning together. Here, the bargaining power in question mostly comes from being a type of supplier that cannot be substituted for any reason. When you have to work with suppliers who have no alternative, have a monopoly position and have a expertise that is not available in any other company that fully dominates the market, or who have machinery and equipment that no one else has, or who cannot be replaced for similar reasons, dependence on these companies will be at a very high level. and they will be equally likely to show tendencies in their business processes that will put the entrepreneur in a difficult position. Similar dependency situations can arise when the costs to be incurred are too high when the suppliers that are currently working are wanted to change. For example, if the production process you set up works in harmony with only one supplier's products, your dependency on the supplier will increase as the cost of replacing it will be very high.

For all these reasons, entrepreneurs are expected to take into account the relationships that will occur with potential suppliers while analyzing the industry before creating their business processes, and if they have to establish some supply relationships in an overly dependent position, they should re-evaluate the idea of the enterprise. Unfortunately, the number of entrepreneurs who had to enter into supply relations with an alternative that cannot be produced and who were in a very difficult situation afterwards, is unfortunately much higher than expected. Even if such problems are noticed during the construction and implementation phase of the enterprise, they can sometimes be underestimated by the excitement of starting a business. This is why it is important to underline the seriousness of the subject with bold lines.

2.1.2. Bargaining Power of Customers

Every enterprise must make an effort to know its customers, understand their needs and preferences correctly, and develop healthy and long-term business relationships with their customers. The main pillar of any business venture's long-term competitive success will undoubtedly be having a large number of loyal customers. However, there are important drawbacks of being overly dependent in relations with customers, just as it is in relations with suppliers.

The customers of a business can be in many different types of individuals and organizations, such as various end consumers, other companies, public institutions, associations and political parties. In addition, it is useful to see the distribution channel members such as wholesalers or retailer with whom the company has to work together to deliver its products to its final customers within the scope of the current discussion. In the process of the value chain, all persons or institutions (customers or distribution channel elements responsible for delivering the product to customers) that the enterprise has to offer its products or services will ultimately act like customers and demand the delivery of products or services with high quality and low prices. At this point, the bargaining power of the customers will come into play as an important factor. Because customers with high bargaining power will want to buy products and services at the prices they desire and at the prices they desire, and they will force the entrepreneurial business to do business in non-ideal conditions.

Entrepreneurs have to give the weight they deserve while setting up their business processes. It is not desirable to be overly dependent in relations with customers. You may have to run your business at the mercy of those customers in a short time if the number of customers you have to do business with is very dependent, either because it is an indispensably important customer or because there is no other alternative in the enterprise processes, or because the cost of switching will be very high. Before advancing the initiative further, it will be an approach that will keep the business away from important problems in the medium and long term by closely examining existing and potential customers in the market, developing relationships that will reduce your dependency and keep your bargaining power as high as possible, and to turn to such markets while determining new markets.

Many entrepreneurs who had to work with large chain retailers to get their products into the distribution system had similar problems arising from addiction. Customers who do not pay for months and demand large discounts can cause many entrepreneurs' dreams to end in a short time. Similar problems can be observed not only in traditional distribution channels but also in the latest systems within the framework of the same principles. For companies that develop applications we use on smartphones, the only way to reach customers in the world market is to take part in distribution sites owned by several large IT companies. Although the sites in question take care to raise their value proposition to a high level by offering various services related to money transfers and collection processes, ultimately they operate as businesses that all companies that develop applications are dependent on and thus accept customers with very high fees, such as thirty percent on average, over sales turnover. Similarly, companies that are industry-leading suppliers to very large companies and that carry out most of their total sales turnover through a single or a small number of such giant companies are essentially in a state of extreme dependence and lack the bargaining power they can use when necessary.

2.1.3. The Power of Competitors and the Violence of the Competition

Every enterprise will sooner or later have to struggle with competition. Competition is actually a process that increases the learning and adaptability of companies and has an effect on increasing quality in general. However, in order for such positive effects of competition to occur, it must be realized through healthy and fair processes. Contrary to the positive effects in sectors where unfair competition exists, the destructive effects of competition may be stronger. Even in a healthy competition situation, if the entrepreneurs think that they do not have the resources and organizational skills to be successful in the current competitive conditions, in other words, they cannot have any competitive advantage, it will be beneficial to give up their venture or to transform their ventures in a direction where they can be advantageous. For these reasons, entrepreneurs are required to accurately determine the nature, processes and intensity of competition as perhaps the most important element of industry analysis and advance their enterprise processes in line with these determinations.

The important principle in competitive processes is to have a distinct competitive advantage compared to competitors. There are two important elements of competitive advantage position. The first of these is the necessity of providing customers with products and services with a higher value than competitors in the eyes of targeted customers. If your customers evaluate your products and / or services as higher quality, more useful or less costly than competitors' products and / or services, they will perceive the value of your suggestion as higher and their preferences will be in favor of your products and services. This will naturally reveal a competitive advantage position. The second element of the competitive advantage position is related to the internal processes of the enterprise and the efficiency of your operational processes while producing your products and / or services. If you can produce the same value at much cheaper costs than your competitors, with much faster and flexible processes, you will naturally be in a competitive advantage. Being superior to competitors in both aspects of competitive advantage position is highly desirable but very rare. Entrepreneurs should look for superiority in both elements if possible, but remember that they must be better than their competitors at least in one.

Therefore, when conducting industry analysis, the primary question that needs to be answered about competition is whether the enterprise can gain competitive advantage and in what terms it should seek competitive advantage. In addition to this, it is extremely important questions must be answered as a whole. Within the framework of the answers to these questions, entrepreneurs can manage their competition processes and reveal the necessary strategic evaluations. While making these evaluations, entrepreneurs should definitely take into account that critical success factors for different sectors will also differ. A resource or talent that creates an advantage in one sector may not have much meaning in another sector. For many industries, there are more critical success factors than anything else that will determine winners and losers in competitive processes. For example, we can state that the critical success factors in the beverage industry are to be dominant in distribution and to have a strong brand. Competitive success in this sector is essentially based on these two basic factors. Entrepreneurs must also take into account the harmony between critical success factors in the relevant sector and their own resources and capabilities while analyzing the sector. Other important factors that need to be considered while analyzing competition are the severity of competition and whether it works with rational (rational) principles. Contrary to what is thought, the competition processes in the business world can sometimes work with unwise processes. Rational or irrational understanding of competition is an understanding of competition that does not benefit anyone and only moves to harm the competitors. Even if I am damaged, it is not a problem, if decisions are made with the understanding that my competitors will suffer more if I make this move, the competition in that sector will naturally be out of rationality and will turn into a spiral in which all competitors are harmed. It is important to avoid such competitive environments. Another competitive environment that is beneficial to avoid is a competitive environment where a very strong firm leads and can direct other actors in the sector in line with its own interests. In this case, since there will be excessive dependence on the leading company, it will be very difficult for the enterprises to reach the desired level of success and sustain their success.

The severity of competition is an important success factor that must be evaluated and followed. Nobody wants to do business in very competitive environments. Fierce competitive environments tend to move away from focusing on quality and benefit design to processes focused on price reductions. Unfortunately, sometimes it is inevitable that the intensity of competition increases due to various factors. The intensity of competition may differ significantly depending on the number of companies competing in a particular market and the degree of differentiation of the products and services they offer to the market. In industries where there are many companies offering similar products, competition will naturally be fierce. Likewise, if the market is not growing and, worse, constantly shrinking, and at the same time that exit from the market requires difficult and costly processes for existing companies (exit barriers are high), it will be much more likely that competition will become fiercer and focus on price reduction rather than quality-oriented.

Other factors that need to be considered while analyzing the severity of competition are the switching costs faced by the customers when choosing between the products of the competitor, and the cost structure and profit margins of the enterprises in the sector. If customers can easily do this when switching from one company's product to another and do not have to bear any costs (such as installation, learning, transportation, effort), competition is likely to be more fierce. Likewise, if the unit fixed costs of the firms in the sector are very high compared to the unit variable costs, it is almost inevitable that competition will become more price-oriented. In such sectors, there will always be a need for more customers and more sales to meet high fixed costs. For example, fixed costs are high in hotel businesses. Variable costs, on the other hand, are relatively low, which is the difference between occupying a room with guests rather than staying empty. In this case, each vacant room will be an important cost factor, and businesses may be willing to settle for serious price reductions to fill these rooms (if necessary, prices can be reduced to the unit variable cost of a room; each price above the unit variable cost will have a positive effect on the total profit). Another situation that has similar effects but is even more difficult for businesses will be in sectors where profit margins are very low. Since no one wants to lose their customers in such sectors, competition is always likely to be very fierce and destructive.

Entrepreneurs have to determine the current nature of competition, its intensity and the competition situations that may arise in the future, in the most accurate way, while analyzing competition. In cases where these analyzes are not carried out or are carried out incompletely / incorrectly, the possibility of encountering major problems increases very much. An important factor to be taken into consideration regarding the future prospects of competition is the threats that may come from new competitors who may enter the market, which we will discuss under the next section.

2.1.4. Threats of New Competitors to Enter the Market

One of the biggest mistakes that many entrepreneurs make in the process of industry analysis is to evaluate the current situation but ignore the new threats that may arise in the future. Especially new competitors that may enter the market later can create very serious threats at an unexpected time. In this sense, issues such as whether there are barriers to market entry in the sector where the enterprise will take place, which new companies the sector may be attracted to, and what the positioning and strategies of these competitors may be in case of new entries are emerging as important analysis questions.

Growing and highly profitable sectors naturally create attractive markets for new and powerful competitors. Entrepreneurs who invest in such markets must take into account that the conditions will not remain the same for a long time, and that sooner or later new and very strong competitors may enter the market. Many factors that will make it difficult or easier for new competitors to enter the market can be evaluated in this sense, and ideas about possible new entries to the market can be developed. For example, economies of scale are needed to be competitive in some markets. Only large companies with very high production and sales can compete in such markets. Since the fixed costs are generally very high, companies that produce and sell below a certain amount will not be able to distribute these fixed costs to the product units sufficiently and will be in a competitive position. There may be new entry threats into such markets only from large firms. A similar situation is also valid for the sectors that require very large capital investments to enter the market.

There are other situations that may prevent new competitors from entering the market, big or small. It will naturally be difficult for new competitors to enter in cases where existing competitors in the sector establish very strong relationships with customers through successful practices and create high customer loyalty. Likewise, it will not be possible for new competitors to enter in cases where customers have high supplier switching costs or when existing companies in the market have already seized some critical resources (raw material resources, location and similar elements) that are not alternative. Often times, companies that want to enter the market may have difficulties in finding a place for themselves in distribution channels. In rare cases, new entrances to some sectors are not possible due to restrictions imposed by the state or other public powers. If the entrepreneurs analyze these and similar factors correctly and carefully, they will be able to evaluate the threats that will come from competitors who may enter the market later.

2.1.5. Threats of Substitute Product Manufacturers

The most dangerous competition for companies transporting passengers by bus comes from the airline passenger transport sector. This threat is particularly evident in long-distance travels of more than 400 km, where the benefit / price ratio of the airline industry, in other words, the value proposition becomes relatively much higher. Competition that may come from substitute product sectors that meet the same customer needs and offer similar benefits may pose a serious threat in some cases. In some cases, as in the case of the airline, the value proposition of the replacement product sectors becomes much more advantageous and can pose a serious threat.

Nowadays, another risk that entrepreneurs must take into consideration is the competition threats that may arise from business models and new sectors that will arise as a result of rapidly developing new technologies. Most entrepreneurs make the mistake of starting their venture on the assumption that technologies and customer preferences will remain constant. However, today technology changes very rapidly and new technologies frequently emerge. Likewise, there may be unexpected major changes in customers' preferences. New business models and products that can hit the market with new technologies can make any product that is successfully in the market today unnecessary and meaningless. While doing industry analysis, it is of great benefit to consider such unexpected changes as much as possible in future-oriented evaluations.

2.2. Industry Analysis and Other Critical Issues Related to Gaining Competitive Advantage and Data Sources

Entrepreneurs have to take into account many different factors in addition to the issues mentioned in the previous sections while making industry analyzes. For example, the speed of technological development is very high in some sectors, and others have been using the same technologies for many years and no change is expected in the near future. While everything is very dynamic and rapidly changing in some sectors, there may be a stagnation and stability that continues for many years in other sectors. While the processes in some sectors are quite predictable, some may have serious uncertainties. In this sense, entrepreneurs should decide which of the different sectors are more suitable for them by evaluating their abilities and skills. Similarly, some sectors may operate in the early stages of the product life cycle (such as entry and growth) and others in later stages (such as maturity and shrinkage). Since the competition dynamics in the sector (from pricing approaches to product and product line designs and positioning preferences) will change significantly at all these different stages, entrepreneurs have to take these differences into consideration. Another important issue that entrepreneurs must learn while developing their business idea is the current legislation on the industry they are interested in and the state's savings to regulate and regulate that sector, if any. In many sectors, how and how entrepreneurs can operate is regulated by the state for the public interest, sometimes with severe restrictions. Complete knowledge of such restrictions is required.

Another reason for the significant differences that may occur between sectors may be developments on the demand side. The most important factor to be taken into account on this front will be the reaction of customers to price changes. In some markets, the price elasticity of demand is very high; Even the smallest price changes can cause serious demand decreases or increases. For some, the prices of the products are not one of the issues that customers are very sensitive to. Likewise, in some markets, customer preferences are very variable and vary significantly between customer segments, while in others, quite homogeneous and unchanging customer preferences may have occurred.

As can be understood from the discussions we have put forward up to this point, industry and competition analysis is actually a complex process that requires very detailed and careful studies in terms of various elements. Many entrepreneurs have difficulty in obtaining reliable information and data about the industry characteristics mentioned in this section. In fact, there is no data source that can be accessed from a single source regarding all the mentioned elements and parameters. Entrepreneurs will have to develop some of the information and data they need by compiling from different sources, and collect some of them themselves.

Data and reports on the general situation and historical developments of different sectors in our country are prepared by many commercial banks, investment banks, public institutions and are available to entrepreneurs in both online and offline resources. Similar reports are prepared by the units of foreign missions' trade attachés and made available in different languages. In addition to these, the Turkish Statistical Institute (TURKSTAT) collects and publishes data including important indicators related to the general economy and various sectors. However, all these sources provide very general information and data due to their nature. The data that entrepreneurs will need regarding their unique markets and business processes are often not readily available in a specific source. Most entrepreneurs have to determine their decisions and strategies with the data and information they collect with their own means.

A work that entrepreneurs must do is to make long and in-depth interviews with various sector actors, especially customers, competitors, suppliers, distribution channel members and sector employees in their micro markets, and try to be informed about the critical dynamics of the relevant market. If there are a small number of entrepreneurs who have been successful in an unfamiliar industry, we can safely argue that luck has helped them significantly. Competing in an environment with insufficient knowledge will be an experience like playing blindfolded football. Therefore, entrepreneurs should make every effort to obtain reliable information about the industry, competition and customers. In this chapter, many of the sectors in question require data and information whose characteristics can be obtained through quite specific market research. For this reason, entrepreneurs should have the knowledge to use market research and data and information development alternatives competently when necessary and when financial resources allow.