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Posted on April 2nd, 2012, by

The market size influences consistently the overall performance of the organization. The market size defines the volume of products and services the company can supply to the market and consumers can consume. The market size defines the potential of the market and, therefore, company’s opportunities in regard to the business development (Gibson-Graham, 2006). At the same time, the market size limits the growth of the company because it cannot overcome the boundaries of the market size. Therefore, the company should look for new options when it has reached the maximum market size and has stopped to grow.

On the other hand, the market size is influenced by the target customer group because, as a rule, companies cannot reach positive results in their business development if they do not reach their target customer group (Bourdieu, 1999). In addition, commodities sold by companies are not interested for customers who do not belong to the target customer group. For instance, students would hardly buy products that are destined to the elderly generation and vice versa the elderly generation would not buy commodities that target at the young customer group.

At the same time, the total market potential is also extremely important for the effective business development. The total market potential is the calculation of the greatest amount of potential sales of a particular product in that product industry in a specific time period (Gibson-Graham, 2006). In actuality, this means that the company reaches the total potential market when it reaches the maximum amount of sales in its industry.

Finally, the market reach/penetration strategy plays an important part in the business development because it defines the strategy of the business development within the specific market and ways of achievement of strategic goals of the company (Bourdieu, 1999).

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