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| EASY METHOD |
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| Find
the market potential for Personal Care Products in the target Zip code. |
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| No target market. |
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| (Data
is from Household Spending Report for 46220) |
Household Count |
Market Potential |
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| Total market potential: |
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16,633 |
$1,975,538 |
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| Estimated
market penetration for first year: |
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5% |
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| Result:
Estimated total annual sales for first year |
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$98,777 |
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| DETAILED METHOD |
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| Core
target market (households age 25-54 and Non-White) |
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| (Data
is from Household Spending Report for 46220) |
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| [1]
Find the number of households in age category 25-54 |
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| Demographic Category |
Class Breaks |
Household Count |
Market Potential |
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| Age |
25 - 34 |
4,061 |
$444,969 |
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35 - 44 |
3,566 |
$488,103 |
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45 - 54 |
3,306 |
$505,980 |
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| Total: |
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10,933 |
$1,439,052 |
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| [2]
Find the percentage of households in race categories other than White |
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| Race |
African-American, Non-Hispanic |
1,592 |
9.32% |
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Other, Non-Hispanic |
366 |
2.70% |
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Hispanic / Latino |
256 |
1.66% |
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| Total: |
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2,214 |
13.68% |
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| [3]
Multiply the 25-54 households by the % of Non-White race |
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Households |
10,933 |
1,439,052 |
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% of Non-White race |
13.68% |
13.68% |
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| Result: Total target market |
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1,496 |
$196,862 |
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| [4]
Find the total non-target market |
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Total in Zip Code: |
16,633 |
$1,975,538 |
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Target (25-54
Non-White) in Zip Code: |
1,496 |
$196,862 |
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| Result:
Total non-target market: |
15,137 |
$1,778,676 |
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| [5]
Estimate market penetration for first year |
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Penetration |
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Target market |
30% |
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Non-target market |
3% |
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| [6] Multiply
market potential by market penetration |
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Market Potential |
Penetration |
Annual Sales |
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Target market |
$196,862 |
30% |
$59,059 |
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Non-target market |
$1,778,676 |
3% |
$53,360 |
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| Result:
Total annual sales for first year |
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$112,419 |
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