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How do you figure out the sales a public company did?

We have potential customers. They sell particular items and we want to be a component manufacturer in these items.

For our business plan, we need to figure out the number of units we can sell in the world. To do this, we need to know how many items our potential customers sell a year.

Here is an example with something familiar: Company X sells 1M button down shirts. We sell buttons. How many buttons can we sell a year to company X?

The challenge I am having is how do I figure out how many of item X a company sold last year? I know their annual gross income per geographical location, but not per item type. I also know the average cost per item. I need to fill in the blanks.

Are there any FREE resources for this sort of thing? Any hints or tricks that will help me out?

17 Replies

Tim Scott
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Tim Scott Entrepreneur • Advisor
President, Lunaverse Software
How fragmented is your target industry? If not so much, how about asking them? At least the biggest ones. I doubt that unit sales figures are terribly secret in mature public companies.
Neil Weintraut
2
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Neil Weintraut Entrepreneur • Advisor
Co-Founder at Rendevu
Alison,

In a prior life so-to-speak, I was a public securities analyst for 9 years. The information that you think that you need is indeed rarely available in direct form, but reasonable proxies can be derived from the information that typically is available.

There are special circumstances such as regulated industries or small-volume industries where the unit volumes must be explicitly disclosed.

The most likely source of "direct" numbers (i.e. unit volumes) would be reports by industry analyst (i.e. the type that sells their services and data to companies, such as say, the Gartner group). To be clear, they would have done the "hard-work" for you, but the numbers that they have are most likely derived.

With that said, getting unit-volume numbers is pretty much what you would expect. An analytical drill of breaking down gross revenues (and COGS) into the components, making reasonable assumptions for unit cost, and dividing. There are some secondary tricks that can be used, such as triangulating differential data between periods (e.g. quarter to quarter), or simply tearing into press releases where often such numbers are citied or "between the lines", or promotional information from competitors (e.g. where they say that they're #2 at such and such a volume, wherein obviously that implies that the gross volume is at least twice that, and so on).

Having said that, the calibre / significance of these derived numbers are typically more than sufficient for business purposes that I envision that you need. For example, I expect and would hope that being off by a factor of 2, doesn't make or break your business or business case (if it does, then there's bigger problems). This includes planning inventory and facilities. Similarly, a key part of any new business is market-growth - unit volume that literally doesn't exist now, but is actually spurred by the startup itself. Even winging-it is often sufficient... there's x-billion of people that would buy this shirt at this price level; 10% penetration is this volume and we expect that our product will expand the market from x-billion to y-billion. I'm responding abstractly because that's all I've got to work with from you question. My point being that unless there's some business issue that's very decisive on knowing the hard gross unit-volumes, and as one who has suffered extracting and using such details, I expect that some simple anecdotally inferred numbers would be sufficient.

Regards
Alison Lewis
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Alison Lewis Entrepreneur • Advisor
CEO/Creative Director
It's not that fragmented.

There are volumes of sales for a particular item available out there, t-shirts for example. From what you all are saying, we could figure out the number made/sold in the US and International based on sales and assuming an average price. Then break that down to the customers we have based on their % of the market place.

Not accurate, per say, but that's alright. I'm just trying to get some general guidelines.

Does that sound about right?
Michael Brill
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Michael Brill Entrepreneur
Technology startup exec focused on AI-driven products
How do u get company market share numbers by category?

If you've got total market numbers then why do you need individual company numbers for business planning purposes? I can see why you want them to determine if you have an appropriate sales model or to prioritize sales efforts. But why at this stage?
Alison Lewis
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Alison Lewis Entrepreneur • Advisor
CEO/Creative Director
I figured I need them because they are real numbers for a real client we have in the pipeline. We have about 4 pipeline clients that we're setting up to do deals with. The volumes have not been decided and I'm doing calculations on at what volume this becomes cost effective.
Neil Weintraut
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0
Neil Weintraut Entrepreneur • Advisor
Co-Founder at Rendevu
Alison,
My sense is that there's some subtleties of your particular need or situation that don't come out in this type of forum, that would either point to a specific angle of approach unique to your situation, or reframe how to move the business forward entirely. You're welcome to contact me directly.
Michael Brill
1
0
Michael Brill Entrepreneur
Technology startup exec focused on AI-driven products
If you're engaged with a handful then I agree with Tim... Ask them. There's probably a non-revenue proxy that they'd be willing to provide... "I'm looking at what we can do on pricing, about how many buttons do u buy today?" People like talking about themselves and what they do so sometimes asking is the best way!
Neil Weintraut
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0
Neil Weintraut Entrepreneur • Advisor
Co-Founder at Rendevu
Too funny. I was entering the preceding response apparently at the same time that you were entering some specifics :-)
Alison Lewis
0
0
Alison Lewis Entrepreneur • Advisor
CEO/Creative Director
Thanks Michael! I did ask. They have not responded as of yet. Thank you...
Michael Brill
0
0
Michael Brill Entrepreneur
Technology startup exec focused on AI-driven products
Definitely a question you want to ask in person/phone vs. email.
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