Questions

We want to find out our Total addressable market (TAM): How big is the market we are currently in? How quickly is it growing? 2. Served addressable market (SAM) We are trying to build a product for sushi style restaurants in Canada.

Because I am a consultant for startups and new businesses, I pay for subscription to variety of market research databases where I can get information about market size, growth, barriers to entry, trends, competition, regulation, etc. http://www.anagard.com/market-research.html One market research report on single industry or market segment can cost few thousand dollars.

If you are lucky, you could find a ready made secondary market research report for your specific market segment that will give you TAM (total addressable market). With this information, you can then focus on your initial market entry, for example a metro area, then figure out how many sales you can make in first few year and that will give your SAM.

Most likely, you will not be able to find a ready made answer. Still, figuring TAM in your case should not be difficult because you are working with already established parameters: number of sushi restaurants in Canada. I am sure it's really easy to find the number of restaurants in Canada (start with trade journals) then find a number of sushi restaurants. Hey, even Yellow Pages would give you a good estimate.
$PPP == price for your product.
TAM = $PPP * number of sushi restaurants in Canada
SAM = number of sushi restaurant that are your customers * $PPP

Investors (angles and VCs) prefer to see TAM larger than $1B. Most inexperienced startup founders will simply claim that SAM is 1% of TAM, and viola, you make millions of dollars. It's not that simple... Anyway, your business probably can grow organically.

Good luck!


Answered 9 years ago

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