Ultimately, you should try this yourself before asking - you'll learn a lot more! That said, see below for a related market sizing that should give you guidance on how to solve this one.
SIMILAR SOLUTION - EV CHARGING STATIONS IN HO CHI MINH
Question: Number of electronic charging station (For electric car vehicle) in Ho Chi Minh City, Vietnam in the next 10 years?
This one could be answered top-down (as I did) by estimating population of the city, # of drivers/ cars, etc. etc.
OR, it could be answered bottom-up by estimating # of stations you see per block (or # of gas/petrol tanks), % increase this might be over time (or # of EV stations that would be needed per gas tank given EV stations take 10 times as long), and # of blocks you'd estimate the city to have.
By # of Electric Cars
- Population of Ho Chi Minh - Around 8 million?
- # of adults - Around 5-6 million
- # of cars per person - around .5 (probably 1 per household)
- % of electric vehicles expected in 10 years -
- highly variable based on country.
- While Vietnam is a developing country (points against), they are also command-and-control communist and are capable of big change (points for).
- The global rate of EV uptake will probably equate to 1% of the global fleet each year (obviously less now, more later). So, perhaps 10% globally? Let's place vietnam around there
- Big consideration: Charging stations are a leading investment to electric cars. So, you need capacity there before demand hits. We will probably need around 1 charging station per vehicle (docking at night). And this would need to lead by a few years. So, we might need charging stations for 15% of the Vietnamese car fleet (instead of 10%)
- Answer = 375,000 - 450,000 charging stations:
- (5 - 6 million people) X (.5 cars per person) X (15%)
Market Sizing Explanation 1
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.
Market Sizing Explanation 2
Do the approach the is the easiest for you given the question.
Are they asking you to estimate something where you don't even know where to begin from the top (maybe you have 0 clue as to the market size of the industry, the GDP of that country, etc. etc.)? Then do bottom-up!
Alternatively, does it seem impossible to do a realistic from-the-ground-up estimation of something (perhaps it requires just far too many steps and assumptions)? Then do top-down!
Fundamentally, you need to take the approach that just makes the most sense in that circumstance. Quickly think about the key assumptions / numbers required and whether you 1) Know them or 2) Can reasonably estimate them. If you can, go ahead!