AQA · GCSE · Business
Course version: 8132 · Version from Sept 2017
Students should be able to identify market size and market share.
Full specification wording
The purpose and methods of market research: Students should be able to identify market size and market share.
Market size is the total value or volume of sales in a whole market, such as all UK sales of a product being £80 million in a year.
Checked against the AQA 8132 specification (opens in a new tab) on .
- Point 19 of 19
- 3 key terms
Study notes
From the checked teaching notes for this specification point.
The idea
Market size is the total value or volume of sales in a whole market, such as all UK sales of a product being £80 million in a year. Market share is one business's portion of that market, expressed as a percentage: market share = (business sales ÷ total market sales) × 100. If a firm sells £20 million in an £80 million market, its share is (£20 million ÷ £80 million) × 100 = 25%. Market size can be measured by value in pounds or by volume in units, so always check which measure the data uses. Identifying these figures helps a business judge how large its market is and how strong its position is compared with rivals.
What earns the marks
- Defines market size as the total sales of all businesses in a market, measured by value or volume.
- Defines market share as the proportion of total market sales held by one business, usually given as a percentage.
- Calculates market share using business sales divided by total market sales, multiplied by 100.
- Calculates a missing value, such as total market size from a firm's sales and its market share.
- Reads market size or share data from a table or chart and states it with the correct unit or percentage sign.
- Uses the figures to comment on a firm's position, for example a 25% share suggests it is a leading competitor.
Common mistakes and how to put them right
Confusing market size with market share.
Put it right: Treat market size as the whole market total and market share as one firm's percentage of it.
Dividing by the firm's own sales instead of the total market sales.
Put it right: Divide business sales by total market sales.
Forgetting to multiply by 100 and leaving the answer as a decimal.
Put it right: Convert the fraction to a percentage.
Exam tips
- Write the formula before substituting numbers so the method is clear to the examiner.
- Check whether the data is in pounds or units and keep that unit throughout the answer.
- Give the final market share with a percentage sign and, where asked, one sentence on what it means for the business.
Try the lesson
The start of the The purpose and methods of market research: Students should be able to identify market size and market share. lesson, made from checked teaching notes for this specification point.
Have a go first
A market is worth £2 million in total and one firm sells £500,000 of goods in it. What is the firm's market share?
Listen
Market size is the total value or volume of sales in a whole market, such as all UK sales of a product being £80 million in a year. Market share is one business's portion of that market, expressed as a percentage: market share = (business sales ÷ total market sales) × 100. If a firm sells £20 million in an £80 million market, its share is (£20 million ÷ £80 million) × 100 = 25%. Market size can be measured by value in pounds or by volume in units, so always check which measure the data uses. Identifying these figures helps a business judge how large its market is and how strong its position is compared with rivals. A strong answer earns marks for these points. Defines market size as the total sales of all businesses in a market, measured by value or volume. Defines market share as the proportion of total market sales held by one business, usually given as a percentage. Calculates market share using business sales divided by total market sales, multiplied by 100. Calculates a missing value, such as total market size from a firm's sales and its market share. A common slip: Confusing market size with market share. Instead, treat market size as the whole market total and market share as one firm's percentage of it. Exam tip: Write the formula before substituting numbers so the method is clear to the examiner.
See it
Key words
Say what each word means before you turn the card.
Market size
Try answering aloud or in your head before turning the card.
Market share
Try answering aloud or in your head before turning the card.
Competitive position
Try answering aloud or in your head before turning the card.
See every definition
- Market size
- The total value or volume of sales in a whole market, measured by value in pounds or by volume in units.
- Market share
- One business's portion of the total market sales, expressed as a percentage.
- Competitive position
- How strong a business's position is compared with rivals, judged from figures such as market size and market share.
Label the diagram
Some boxes have lost their names. Pick the right name for each number.
1Box 1
2Box 2
3Box 3
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