Definition

Market potential is the entire size of the market for a product at a specific time. It
represents the upper limits of the market for a product. Market potential is usually
measured either by sales value or sales volume. For example, the market potential
for ten speed bicycles may be worth $5,000,000 in sales each year. On the other
hand, the market potential for motorcycles may be 500,000 units each year, which is
a measure of sales volume rather than sales value. Keep in mind that market
potential is just a snapshot in time. It's a fluid number that changes with the
economic environment. For example, rising and falling interest rates will affect the
demand for products that are typically financed, like cars and houses.
Analysis of Market Potential
Determining the market potential of a product is part of a successful marketing
process and requires marketing research. You'll need to examine at least three
factors that will determine whether the market potential of your product is worth the
investment. You need to analyze your potential customer base, your competition,
and the current environmental conditions that may affect market potential.
Analyzing Potential Customer Base
You need to determine the size and demographic characteristics of your potential
consumers. Important information to obtain includes the population size of your
target market, their product preferences, and their median annual household income.
This will tell you the number of potential customers and whether they can actually
afford the product.
You can assess your product's potential customer base by analyzing secondary
data, or data that already exists, such as demographic data collected by the United
States Census Bureau on household demographics in each state. You may also
decide to collect primary data, which is data you collect specifically to analyze the
market potential of a product. Typical means of collecting primary data include
telephone surveys using a random sample of households drawn that you believe
match your target market.

Analyzing Competition
Unless you are very fortunate and are bringing an entirely new type of product to the
market, like the first iPod, you'll almost certainly have competition. It is important to
assess the number of your competitors, their respective share of the current market,
and how your product can be differentiated from theirs. This research can be
undertaken using both primary and secondary research. Secondary data sources
may include industry surveys, membership directories of industry organizations, data
collected by local chambers of commerce, and data collected by state agencies.
Primary data can be collected by simply shopping around and examining your
competition from the perspective of not only a competitor but as a consumer

Imported fruits posing challenges to domestic growers: Sharad Pawar

PTI Jul 17, 2013, 02.31PM IST

Tags:

Saumita Chaudhuri report|

post-harvest losses|

Imported fruits|

farmers income|

Environmental Issue|

Agriculture Minister Sharad Pawar

(Agriculture Minister Sharad)

NEW DELHI: Agriculture Minister Sharad Pawar on Wednesday expressed concern
that imported fruits like apples and kiwis are posing a major challenge to domestic
growers and emphasised the need to strengthen supply side infrastructure to ensure
locally produced fruits compete with imported ones.

He said their is a need to implement the recommendations of the Saumita Chaudhuri

report on

cold

chain

development

for

reducing post-harvest

losses and

improve farmers income.

"We need to attach importance to cold chain infrastructure and implement the
recommendations of the Saumitra Chaudhuri report so that we can effectively
compete with supply chain for imported apples, pears, grapes, kiwis and cherries
which is posing a major challenge to domestic growers," Pawar said addressing the
National Horticulture Conference here.
Although there is a pan India market for kiwis from Arunachal Pradesh, cherries from
Jammu and Kashmir, pears from Punjab and grapes from Maharashtra, government
need to address concerns of growers -- from planting material to post harvest
management and issues of logistics and price discovery.
Noting that the challenge before the government is to ensure adequate income to
farmers, Pawar said: "The only way we can have equitable and inclusive growth is
when small farmers can save enough to invest in newer production technologies. If
we do not make farming remunerative, we will not be able to retain the interest of
younger generation."
The targeted 4 per cent farm growth could be achieved in 12th Five Year Plan (201217) from high-value agriculture, of which horticulture is an important segment, he
noted.
Stating that India has a long way to go in establishing a robust cold chain system
from farm to fork, he asked his horticulture officials to look at some technologies
relevant to India and identify more 'origin-destination routes' for movement of
horticulture produce.
Also, he asked if integrated projects could be taken up on cold chain in production
clusters with linkages to consumption centres and how the centre can work closely
with state governments and growers associations.

With likely rise in demand for vegetables and fruits, Pawar said there is a need to
further enhance production these items as demand is expected grow with higher
income, urbanisation and changing food habits.
Currently, productivity of horticulture crops is lower in India as compared to other
countries and the yield gaps need to be address in the current plan period itself, he
said.
He also asked state governments to take adequate measures to address the impact
of climate change on horticulture crops.
India is the second largest producer of vegetables and fruits in the world.

Demand good, new guidelines pose challenges for Indian importers

Demand for fresh fruit imports increased in India last year, though the country's
importers have had to deal with some challenges. New guidelines for imported

apples have made it more difficult to bring fruit into the country and the lingering
effects of 2013's currency valuation swings have forced consumers to adjust to new
prices.
The market for imported apples in India was good last year,
though there were some pricing issues, said Tarun Arora of IG
International. Prices rose by six or seven dollars on a carton of
apples due to currency depreciation, so consumers were still getting used to the new
pricing.
Fortunately for importers, currency issues did not bleed in 2014. But it did bring
changes in labelling guidelines for imported apples. While there were no labelling
guidelines prior to 2014, the Food Safety Standards Association of India
implemented new rules that many importers felt hindered their business.
The new labelling laws are quite strict, said Arora. Before, you could just ship the
fruit and didn't have to print cartons specifically for the Indian market. Now, they want
labels that have packing dates, expiration dates, packer names, exporters names
and many other things. These changes have reduced the volume of apples coming
into India In addition to labelling guidelines, new rules were also introduced
regarding the types of fungicides that can be used to wash incoming fruit.

IG International sources its apples from Washington State in the United States,
China, Chile and New Zealand. This year's shipments from New Zealand were about
70 percent lighter than those from the previous season.
Chilean imports made up for the slip in volume from New Zealand, and Arora
believes Chile will hang onto that new market share. Arora estimates they've
imported about 350,000 cartons of apples from Chile last year and even more from
Washington State. Though demand has been sluggish in December, demand was
good for most of the 2014, and Arora believes it will pick up again this month. Overall
demand for fresh fruit has been growing.
Imports of kiwifruit from New Zealand were up last year for IG International, with
2013's volume of 200,000 trays growing by 40 percent for 2014. Arora noted that
reports on kiwifruit helping prevent dengue fever stoked interest in the fruit and led to
good movement.
Citrus imports increased last year, and IG International also brought in their first
shipments of Turkish citrus. About 40,000 boxes of Turkish fruit were imported by IG

International, and imports of established players, like Egypt, also rose. In fact, over
the last four years, Arora estimated that their volume of Egyptian citrus rose by 40
percent. South African citrus also had a big presence in India this season.

While imports of most fresh fruit rose in 2014, grape shipments were about the same
as those from 2013. Red globe grapes from California remain the most popular in
India, and though demand is decent, the volume of fruit hasn't increased.
We're seeing steady growth with fruit in general, said Arora. But imports of grapes
are not rising the same way as imports of other items. Aside from the introduction of
Turkish fruit last year, new items haven't made much headway in India. Arora thinks
it's a feature of any market that new players and new items have a tough time finding
a foothold. It requires a lot to take on already established products and sources, and
though it's exciting to try and break a new market or build up demand for a new
product, it's also risky.
Delivering products online is something new, but e-commerce in India has some big
challenges, noted Arora. It's very difficult to grow a category online. Instead, he
has focused largely on in-store promotions and direct relationships with
supermarkets. In general, he is bullish towards supermarket promotions and the
Indian market as a whole.

The market for fresh fruit in India has been developing more and more every year,
said Arora. Consumers are more aware of more varieties. But there remains a
segment of the consumer base that shops purely based on price, so varieties offered
and quality of fruit offered has to be balanced. While most of the many items that IG
International ships are sold at premium prices, Arora noted that imports of citrus,
which are generally priced lower, continue to be a big part of IG International's
business plan.
Arora believes this is a good moment for the Indian market, and IG International is
trying to capitalize on this moment by expanding its cold chain. While it already has
40,000 tons of cold storage space, there are plans to build two new facilities in
Bangalore and Delhi.
Deficits are down and growth looks to be back in the Indian market, said Arora.
The stock market is marking a new high, every week, it seems. I believe in the
Indian growth story, so, overall, I think it's a good time to be in India.