A holistic approach to market assessment for a manufacturing company in an emerging economy

Assessing the potential for a new market is challenging both for new businesses and for already existing businesses that are trying to expand. The primary challenge is the difficulty in identifying the important factors that influence market potential. The other challenge is that once the influencing factors are identified, there are very few structured mechanisms available to show how these factors affect the bottom line of the business. In this paper, the authors present a three step market assessment methodology and illustrate it with an example of a manufacturing company. The proposed methodology is applicable especially to the case of an already existing company trying to expand its operations and sales to a new country or emerging market. The first step assesses the broad market potential of a country; the second step estimates the sales potential for a specific company, and the third step calculates return on investment for the company based on the resources required. Each step of the methodology accounts for several external and internal factors. An example of a fastener manufacturer targeting the Mexican market is used to demonstrate the application of the proposed methodology.

► A three-step market assessment methodology to assess market growth in an emerging economy is proposed.
► The methodology accounts for both micro and macro economic factors.
► The final step ties in market growth opportunities to the return on investment equation.
► An illustration showing a fastener manufacturer/distributor looking to expand their business into Mexico is shown.