I have been practicing the replacement theory but also wanted to reach out and ask if anyone had any additional tips or guidance on this subject as I prepare?
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Ian, thank you for your response. It was about market sizing overall, as well as using replacement theory within the structure of market sizing.
Hi Clara,
Thank you for your feedback. It is greatly appreciated, as I will follow the link that you provided.
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On market sizing, or on the replacement theory?
The “replacement theory” is just a small tool within market sizing (and honestly I don't find it intuitive at all).
If it is about market sizing here you have a couple of useful links:
https://www.preplounge.com/en/consulting-forum/market-sizing-approach-12396
https://www.preplounge.com/en/consulting-forum/how-do-you-estimate-the-1-year-annual-sale-of-a-small-corner-coffee-shop-12123
https://www.preplounge.com/en/management-consulting-cases/brain-teaser/intermediate/taxis-in-manhattan-market-sizing-229
Hi Jay,
By replacement theory do you mean when you think about the lifespan of a product?
Quite simply, you just need to figure out how many years that item lasts, then divide by that to get the annual replacement.
You can do this for cars, appliances, bed, etc. and you can also do it for “human” factors such as for marriages, illnesses, etc.
Hey there,
Don’t overcomplicate things!
First time I hear about this theory - same as some other seasoned ex-consultants it seems.
This alone tells me that you might not want to use it in a case, unless it’s really intuitive and easy to understand and, most importantly, appropriate for the problem at hand.
I recommend focusing your energy on developing great custom approaches yourself through fit for purpose MECE frameworks. If you master this key skill, you’re nearly there.
Let me know if this is something you‘re interested in discussing. Best of luck!
Hello!
Happy that you ask! Given that market sizing cases were the topic of many questions in this Forum, I developped a market sizing case, that you can find for free in PrepL´s library
https://www.preplounge.com/en/management-consulting-cases/candidate-led-usual-style/intermediate/market-sizing-new-startup-launch-baby-strollers-in-the-us-244
Let me know if you have any doubts with it, it contains a detailed explanation and methodology about how to solve this specific example, but you can extrapolate to many other market sizings!
Thank you for your feedback. It is greatly appreciated, as I will follow the link that you provided.
Thank you for your comment. Apologies for not clarifying my question, but I was referring to market sizing overall. As you mentioned, "replacement theory" is a tool within market sizing.
Thank you for the links. Very helpful.