How would you approach this case?
Market sizing question: Private security market in USA ($)
Overview of answers
I was not aware of this. I didn’t want to share my approach and influence the resolution of the case.
I would assume that private security agents, can work for the A) privates but also for the B) businesses like stores/cinemas…
A) Number of agents for private sector
I would start from the #households in USA 360M/3~120M
Then I would segment the population per social classes, in 5 classes assuming that the distribution can follow the Gaussian curve:
Upper class 10% ~12M
Middle Upper class 20%
Middle Class 40%
Middle lower class 20%
Low class 10%
At this point I would assume that the security service is used only from 1% of the upper class segment, considering that USA doesn’t suffer of a high crime rates in the upper class areas.
Upper Class 1% ~ 120k
Considering that the security service works 24/7, I need to multiply for the number of shifts 3.
#of security agents in the private sector~360k.
B) Looking at the second part I would divide equally the population across the country geographically in 3 areas, West-Coast/Centre/East-Coast and I would assume that the ratio people to number of stores is different.
West 1/1000 ~120M/500 ~240k
Centre 1/1000 ~ 60k
East 1/500~ 240k
Let’s assume we have in USA 540k stores. Of these one every 5 stores will hire a security guard.
Let’s take into consideration the shifts *3 à 100k*3~300k
#security agents in USA~ 360k + 300k~660k
How would you?
I think most experts (including me) have stopped answering these blanket questions. Please provide your approach, then you'll get tips and feedback!