9 Things A Good Economic Impact Analysis Should Include
Anytime an entrepreneur wants to open up shop, they do so with the hopes of being wildly successful. However, an area in which many entrepreneurs lack solid work in is conducting an economic impact analysis (EIA) of their business & the area in which they’d like to operate. Some might argue that it may not make the most sense to latch one’s wish to do business on something as general as an EIA. However, choosing to ignore how one may (or may not) fit into an area can have major consequences.
In a nutshell, an EIA enables companies & communities to know whether or not they are a fit with each other. At least, that’s the goal. Far more often, though, many companies tend to focus more on the idea of how profitable an area & audience may be and nothing more. Unfortunately, the focus on only revenue can & usually is detrimental.
EIAs need to be all-encompassing in the data they elicit. Much of the work to get there starts by making sure the following are part of the analysis from the start:
Defining what ‘local’ and ‘community-at-large’ mean gives those conducting the analysis a way to be more focused & do away with extraneous data points.
The EIA breaks down specifics when it comes to methodologies utilized, assumptions made, and the time frame the analysis is focusing on.
B2B & B2C Impact
Being a ‘neighbor’ can carry a lot of weight, both good and bad. Interactions with both prospective customers AND nearby businesses need to be looked at in detail.
Importance of Industry
Specific research into whether or not a company’s industry actually has merit within a community is incredibly important.
Positives & Negatives
A well-rounded & trustworthy EIA showcases the good & the bad of a company’s influence in a community.
Reliable Data Collection
There has to be measured attempts to do away with variables that can make final results convoluted.
Only About Money?
Impacts other than profit should be explored or at least requested by a company so that a better overall picture can be considered.
Defining A Goal
Remember that data is nothing more than information without purpose. Conducting a structured EIA with a goal in mind from the start keeps things on track.
Finally, an economic impact analysis should include clear & constant communication between the firm conducting the EIA & the company that requested it.
An economic impact analysis from an Austin advertising agency might seem a little too narrow in focus. That is, of course, if you were talking about someone other than MindEcology. See what makes them different today.