Market Share

Market share

Market share is the portion or percentage of sales of a particular product or service in a given region that are controlled by a company. example, there are 100 widgets sold in a country

and company A sells 43 of them, then company A has a 43% market share

Market Share

Or – you sold widgets for a total cost of $860 and the people in the country spend a total of $2,000 on the same widgets, then the market share is $860/$2,000 or 43% The two different methods of calculating market

share won't always provide the same answer,

Market Share

Market share is used by businesses to determine their competitive strength in a sector as compared to other companies in the same sector

Method 1 – Number of Buyers

Estimate the total number of buyers in your market and determine how successful your competition is

Per month, estimate the number of people that will buy your product or service This is your percentage

Method 1 – Number of Buyers

Ex/ Organic Coffee House Number of Tim Horton’s – 3040 Market Share = 76% of Coffee and Baked

Goods Tim’s Sells 3 million cups a day

3,000,000/ 3,040 = 987 cups sold per day per store 987* 30 days = 29,605 per month 29,605 / .76 = 38,954 cups a month for a store to have

100% market share in their area

Method 1 – Number of Buyers

Our Organic Coffee House should get 2% of the market, based off of the following data… (trends that support your business) 2% of total market share or 779 cups sold a day 38,954 * 0.02 = 779 cups sold a day

Method 2 – Percent of Sales

Total Market Share of top 5 competitors and average last five years of sales

Ex/ Organic Coffee House Top Five Competitors

Tim Horton’s – 76% - Sales $14 billion Starbucks – 7% - Sales $1.3 billion Timothy’s Coffees World Inc – 4% - Sales $736 million Second Cup – 2% - Sales $386 million William's – 1.5% - Sales $276 million

Method 2 – Percent of Sales

I think we can have a market share of 0.05% based on the following data … (trends…) Market share of 0.05% = $ 9.2 million sales