Guesstimate — Estimate the market share of pencils

Welcome to Day 8/30 of Mastering Guesstimates

Sanyam Aggarwal
3 min readSep 6, 2023

Q. Estimate the market share of pencils.

Clarifying Questions:

  1. By pencil you mean only wooden ones or also digital ones like apple pencil or mechanical pencils?
  2. Calculation for a box of pencils or pencils as a single unit?
  3. Calculation in terms of revenue or quantity?
  4. Current market share or projected future? if future then any information about growth rate?
  5. Calculation for India or any specific geography?

A. Consider only wooden pencils as a single unit, in terms of revenue, calculate for current and take India as geography

Assumptions:

  1. India population is ~140 Crores.
  2. Life cycle of one pencil (as per my use and observation): Heavy Usage — 15 Days, Casual Usage — , Low Usage —

Approach:

Population of India = 140 Crores

Pencil will only be used by literate population = 80%(140 Crore) = ~110 Crore

Age Wise Distribution:

Age Wise Split for Literate Population
Split between 0–15 yrs Age Group

Calculating Casual Users = (0.14 * 110) + 15 = 30 Crores

Calculating Heavy Users = 18 Crores

Lifecycle of each pencil for heavy users = 1 month = 12 pencils in a year

Let Heavy Users buys 2 Pencils at a time (then 12/2 = 6 pencils in a year) = 18 * 6 = ~ 110 Crore Pencils

Lifecycle of each pencil for Casual users = 6 months = 2 pencils in a year

Let Casual Users buys 1Pencils at a time = 30 * 2 = 60 Crore Pencils

Market Share of Pencil (in quantity) = 170 Crores

Market Share of Pencil (in revenue) = 170 Crores * 5 (cost of each pencil) = Rs 850 Crores

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Stay tuned for Day 8/30 of Mastering Guesstimates, Until then, let curiosity be your guide and let the adventure begin!

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Sanyam Aggarwal
Sanyam Aggarwal

Written by Sanyam Aggarwal

Data and Product Enthusiast | Follow Me 🫶 to Conquer the Art of solving Guesstimates

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