Case Interviews
How would you sense-check a market sizing for speed cameras?
I'm estimating the annual market for speed cameras in Sweden. I started with households to estimate about 3.75 million cars, then used different camera-per-car ratios for urban and rural areas. That gave me about 60,000 installed cameras.
I assumed a ten-year life and that only half of the cameras coming up for replacement would actually be replaced, giving around 3,000 replacements a year. These are my working assumptions, not figures I've verified. Does that approach make sense, and what am I missing?
Ian’s Answer
A few notes here:
You should never be “guessing”. A fair few amount of your numbers feel like pure guessing. You should always be breaking things down in a way that lets you estimate
I don't love your approach. Why are we doing cameras per household? Rather, you should approach it from a regulatory/government perspective. Think about the # of roads and cameras installed and then include the # of cops (particularly traffic cops) and how many would be needed for each…
You forgot to include the market size…i.e. multiply by price
Any # you have should be backed with reasoning (for example, why 10 years assumed?)