Market sizing involving buildings

Market sizing
New answer on Dec 31, 2021
2 Answers
2.1 k Views
Anonymous A asked on Nov 02, 2018

Hello,

I have a general question about market sizing cases. If we need to estimate, for example, the number of phones, or fire hydrants in the US, how can we tackle the commercial building part? How can we estimate number of offices, or number of schools, hotels etc?

Overview of answers

Upvotes
  • Upvotes
  • Date ascending
  • Date descending
Best answer
Vlad
Expert
Content Creator
updated an answer on Nov 02, 2018
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

By splitting the city into the # of blocks and trying to estimate the average number of (Fire hydrants, etc) per one block

Another way - calculate separately the number of leaving buildings from the population and then assuming x commercial buildings per y living.

Best

(edited)

Was this answer helpful?
m on Nov 02, 2018

Thanks for your answer. I would use the # of block approach if the question asked in a specific city, but what about US?

Ian
Expert
Content Creator
replied on Dec 31, 2021
MBB | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

Hi there,

Providing some market sizing thinking for anyone revisiting this Q&A:

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.

Some tips:

  1. Just like in a case, make sure you understand the question - what are you really being asked to calculate
  2. Decide whether a top-down or bottom-up approach is best
  3. Figure out what you know you know, and what you know you don't know, but could estimate
    1. This helps you determine how to split out buckets
  4. Stay flexible - you can start with a "high-level" market sizing, but gauge your interviewers reaction....if it looks like they want you to do more...then go along level deeper in terms of your splits
Was this answer helpful?
Vlad gave the best answer

Vlad

Content Creator
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School
425
Meetings
11,749
Q&A Upvotes
127
Awards
4.9
185 Reviews