Market Research and financial model for Italian agency expansion plans

CASE STUDY
Share this: Market Research and financial model for Italian agency expansion plans How we helped an Italian construction material retailer evaluate and plan their expansion into the Nigerian market. A leading Italian construction material retailer sought to evaluate the feasibility of establishing a local retail presence in the Nigerian market. GravityThink was engaged to conduct comprehensive market research and develop a robust financial model to support the client’s expansion strategy. THE SITUATION Our client faced several challenges in their quest to enter the Nigerian market: Limited understanding of local market demand and supply dynamics. Uncertainty about the competitive landscape. Lack of clarity on the financial feasibility of the expansion. Insufficient knowledge of capital requirements for market entry. These obstacles hindered the client’s ability to make an informed decision about their expansion plans.They needed a clear picture of the market opportunity and a solid financial foundation to move forward confidently. OUR APPROACH Market Research and Demand Sizing Our team conducted on-site primary research to gain deep insights into the Nigerian construction materials market. We analyzed key economic drivers, industry trends, and growth prospects. This involved: Interviewing local industry professionals and potential customers. Studying competitor strategies and market positioning Assessing supply chain dynamics and logistics challenges The research provided a comprehensive view of the market size, growth potential, and our client’s possible competitive advantage. Location Analysis We performed a preliminary suitability analysis to identify potential store and warehouse locations. This involved: Evaluating foot traffic and accessibility in various urban centers. Assessing proximity to key construction hubs and transportation networks. Analyzing local real estate costs and regulations. Financial Modeling and Valuation Based on our market research, we built an investor-ready financial model. This model included: Detailed revenue projections based on market demand estimates. Cost structure analysis, including fixed and variable costs. Working capital requirements and inventory management projections. Capital expenditure estimates for store setup and operations. We used a discounted cash flow (DCF) model to determine the project’s net present value (NPV) and internal rate of return (IRR). This allowed us to analyze the investors’ return profile under various scenarios. This approach ensured that our client had a clear understanding of both the opportunities and challenges associated with their expansion plans. THE RESULTS Our work equipped the client with the necessary tools and insights to make an informed decision about entering the Nigerian market. As a result of our work, the client was able to confidently move forward with their expansion plans, armed with data-driven insights and a robust financial framework. The clarity provided by our analysis not only supported the client’s decision-making process but also positioned them to attract potential investors and partners for their Nigerian venture.

CASE STUDY

Market Research and financial model for Italian agency expansion plans

How we helped an Italian construction material retailer evaluate and plan their expansion into the Nigerian market.

A leading Italian construction material retailer sought to evaluate the feasibility of establishing a local retail presence in the Nigerian market. GravityThink was engaged to conduct comprehensive market research and develop a robust financial model to support the client’s expansion strategy.

THE SITUATION

Our client faced several challenges in their quest to enter the Nigerian market:

Limited understanding of local market demand and supply dynamics.
Uncertainty about the competitive landscape.
Lack of clarity on the financial feasibility of the expansion.
Insufficient knowledge of capital requirements for market entry.

These obstacles hindered the client’s ability to make an informed decision about their expansion plans.They needed a clear picture of the market opportunity and a solid financial foundation to move forward confidently.

OUR APPROACH

Market Research and Demand Sizing

Our team conducted on-site primary research to gain deep insights into the Nigerian construction materials market. We analyzed key economic drivers, industry trends, and growth prospects. This involved:

Interviewing local industry professionals and potential customers.
Studying competitor strategies and market positioning
Assessing supply chain dynamics and logistics challenges

The research provided a comprehensive view of the market size, growth potential, and our client’s possible competitive advantage.

Location Analysis

We performed a preliminary suitability analysis to identify potential store and warehouse locations. This involved:

Evaluating foot traffic and accessibility in various urban centers.
Assessing proximity to key construction hubs and transportation networks.
Analyzing local real estate costs and regulations.

Financial Modeling and Valuation

Based on our market research, we built an investor-ready financial model. This model included:

Detailed revenue projections based on market demand estimates.
Cost structure analysis, including fixed and variable costs.
Working capital requirements and inventory management projections.
Capital expenditure estimates for store setup and operations.

We used a discounted cash flow (DCF) model to determine the project’s net present value (NPV) and internal rate of return (IRR). This allowed us to analyze the investors’ return profile under various scenarios.

This approach ensured that our client had a clear understanding of both the opportunities and challenges associated with their expansion plans.

THE RESULTS

Our work equipped the client with the necessary tools and insights to make an informed decision about entering the Nigerian market.

As a result of our work, the client was able to confidently move forward with their expansion plans, armed with data-driven insights and a robust financial framework. The clarity provided by our analysis not only supported the client’s decision-making process but also positioned them to attract potential investors and partners for their Nigerian venture.