Serviceable obtainable market is a conservative and realistic estimate of the revenue for a product or service. It may be based on the total size of a market and the percentage of that market that you are likely to win. This is based on your strengths against the competition in areas such as promotion, sales, distribution, pricing and brand awareness. Service obtainable market also considers customer needs and preferences to assess what percentage of a market can realistically be captured by your product.
ExampleA Japanese restaurant opens in a mid-sized Australian city. The total market for restaurants in the city is $4 million dollars a month. They estimate the demand for Japanese food at 15% of this, or $600,000 a month. There are three other Japanese restaurants in town meaning that they each on average will have gross revenue of $150,000 a month. The restaurant assesses its competitiveness and feels it will do better than average. They set their serviceable obtainable market at $200,000 a month this represents a 5% market share.
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