The term industry refers to groups of establishments that produce similar products and services.
Establishment is simply another word for a company or business. Establishments may range in size from large factories to small businesses employing only a few workers.
Knowing something about the industry in which a firm competes is very helpful in being able to judge a firm's performance.
For example, if you are researching Nike, you will need to gather data on the size of the athletic shoe market, who the key manufacturers are and their respective market shares, and what the trends and projections are for this particular industry.