Market Capacity Estimation

Market volume (size, market capacity) — the size of the market for a particular product or service, expressed as the total volume of sales of the product (in physical or monetary terms) over a period of time within predetermined geographic boundaries.

Usually, an assessment of the market volume is carried out to make a decision on the advisability of entering a new market for the Customer.
The most important aspect in assessing the market capacity is the definition of the product boundaries of the study, unambiguously understood by the Contractor and Customer of the study. Description of product boundaries should take into account the properties and characteristics of the products under study.

A combination of methods is used to estimate market size, depending on product boundaries and the availability of the data being sought.
In the presence of own consumption by the manufacturer of the studied products, a non-commodity market is formed, which is inaccessible to other participants. Usually, an estimate of the market volume is calculated through the volume of production for the commodity market, import and export, less often — through the volume of demand by consumers.

Estimating the size of the market can be both an independent task and part of a comprehensive market research.

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