Theoretical and practical aspects of measuring market potential

Abstract

The area of research in this paper refers to the theoretical, practical and methodological aspects of the assessment of market potential. It presents the main factors relevant to assessing market potential. The process of evaluating the market potential is important, first of all, for optimal adoption of future strategic decisions in business. Planning of business processes is one of the main reasons for the assessment of the market potential and managers often face, when planning, the environmental factors that can not be influenced. Realistic and quality assessment of market potential and sales forecasting in companies becomes not only a means of gaining competitive advantage, but also a necessary condition for long-term development and survival in the market. Knowledge of the potential market increases the efficiency of business operations. To this end, the theoretical, methodological and practical problems of assessment of market potential were analyzed. The need for this is all the more pronounced because of objective, reliable and valid assessment of the market potential is a prerequisite of business improvement and long-term development of enterprises. The aim was to explain the characteristics of the market potential as one of the primary market sizes in order to carry out its assessment. In this context, it was necessary to identify the main factors influencing the assessment of market potential. Results of the study showed that factors of macro and micro environment of the company, competition and purchasing power determine the market potential of edible oil in Bosnia and Herzegovina. In the empirical part of the paper are applied most common methods of assessment of market potential.