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Ian

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How much restaurants are in Paris?

Hey,

How would you start with the following question: How much restaurants are in Paris?

Hey,

How would you start with the following question: How much restaurants are in Paris?

• Date ascending
• Date descending

Hi there,

I presume you mean "How MANY restaurants?"

This is a classic market sizing :)

Top Down

1. Population of Paris
2. Breakdown by Age and/or Income Segments
3. Estimate frequency of lunch/dinner outings per week per group (I would clarify that we don't need breakfast places as these are cafes not restaurants)
4. Estimate occupancy + throughput of an average restaurant (obviously during lunch/dinner hours)
5. Multiple 2 with 3. Divide those by #4

And voila, as they say :)

Bottom Up

1. State how many restaurants you see in a given road/strip in Paris
2. Extrapolate out to estimate how many would be in a given arrondisement (either estimate this point-blank if you've lived in one OR estimate how many blocks/roads there are).
3. Figure out if your given arrondisement is an average (i.e. some are more commercial, others more financial, etc.)
4. Multiply by 20 (there are 20 arrondisements)

And voila :)

Of course, for the above, confirm what we mean by Paris. Paris proper = the 20 arrondisements. But, of course, Paris extends far further than just the arrondisements!

General Market Sizing Tips

Remember that there's rarely a "best" answer with market sizing. What's important is that you break down the problem the way it makes sense to you. Importantly, break it down so that the assumptions you make are the ones you're most comfortable in.

For example, do you know all the major brands? Great go with that. Do you understand all the segments of that country's population (either age or wealth or job breakdown)? Go with that. Do you know the total market size of the tourism (or hotel) industry? Then break it down that way.

Hi there,

I presume you mean "How MANY restaurants?"

This is a classic market sizing :)

Top Down

1. Population of Paris
2. Breakdown by Age and/or Income Segments
3. Estimate frequency of lunch/dinner outings per week per group (I would clarify that we don't need breakfast places as these are cafes not restaurants)
4. Estimate occupancy + throughput of an average restaurant (obviously during lunch/dinner hours)
5. Multiple 2 with 3. Divide those by #4

And voila, as they say :)

Bottom Up

1. State how many restaurants you see in a given road/strip in Paris
2. Extrapolate out to estimate how many would be in a given arrondisement (either estimate this point-blank if you've lived in one OR estimate how many blocks/roads there are).
3. Figure out if your given arrondisement is an average (i.e. some are more commercial, others more financial, etc.)
4. Multiply by 20 (there are 20 arrondisements)

And voila :)

Of course, for the above, confirm what we mean by Paris. Paris proper = the 20 arrondisements. But, of course, Paris extends far further than just the arrondisements!

General Market Sizing Tips

Remember that there's rarely a "best" answer with market sizing. What's important is that you break down the problem the way it makes sense to you. Importantly, break it down so that the assumptions you make are the ones you're most comfortable in.

For example, do you know all the major brands? Great go with that. Do you understand all the segments of that country's population (either age or wealth or job breakdown)? Go with that. Do you know the total market size of the tourism (or hotel) industry? Then break it down that way.

(edited)

Thanks for this - in a market sizing case, would you do the top down and bottom up or only 1 approach? — Anonymous B on Mar 22, 2021

It depends...you have to determine based on the situation! — Ian on Mar 23, 2021

Hello!

I would always recommend you to give it a shot and then post it here, this would help you the most.

This is a very typical market sizing case, where the key steps are:

• Calculate the total population of the city
• Calculate the % of population that could be interested in this product (this could be done by clustering -the classical ones are age groups, purchaching power, etc.-). The product in this case is very generic, which makes the exercise more interesting.

Hope it helps!

Cheers,

Clara

Hello!

I would always recommend you to give it a shot and then post it here, this would help you the most.

This is a very typical market sizing case, where the key steps are:

• Calculate the total population of the city
• Calculate the % of population that could be interested in this product (this could be done by clustering -the classical ones are age groups, purchaching power, etc.-). The product in this case is very generic, which makes the exercise more interesting.

Hope it helps!

Cheers,

Clara

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