Research and Markets: The 2009 Report on 235 to 240-Pound Organic-Base Asphalt Strip Shingles Excluding Laminated Shingles: World Market Segmentation by City

DUBLIN--(Business Wire)--
Research and
Markets(http://www.researchandmarkets.com/research/69e033/the_2009_report_on)
has announced the addition of the "The 2009 Report on 235 to 240-Pound
Organic-Base Asphalt Strip Shingles Excluding Laminated Shingles: World Market
Segmentation by City" report to their offering.

Market Potential Estimation Methodology

Overview

This study covers the world outlook for 235 to 240-pound organic-base asphalt
strip shingles excluding laminated shingles across more than 2000 cities. For
the year reported, estimates are given for the latent demand, or potential
industry earnings (P.I.E.), for the city in question (in millions of U.S.
dollars), the percent share the city is of the region and of the globe. These
comparative benchmarks allow the reader to quickly gauge a city vis-à-vis
others. Using econometric models which project fundamental economic dynamics
within each country and across countries, latent demand estimates are created.
This report does not discuss the specific players in the market serving the
latent demand, nor specific details at the product level. The study also does
not consider short-term cyclicalities that might affect realized sales. The
study, therefore, is strategic in nature, taking an aggregate and long-run view,
irrespective of the players or products involved.

This study does not report actual sales data (which are simply unavailable, in a
comparable or consistent manner in virtually all of the cities of the world).
This study gives, however, my estimates for the worldwide latent demand, or the
P.I.E. for 235 to 240-pound organic-base asphalt strip shingles excluding
laminated shingles. It also shows how the P.I.E. is divided across the world's
cities. In order to make these estimates, a multi-stage methodology was employed
that is often taught in courses on international strategic planning at graduate
schools of business.

What is Latent Demand and the P.I.E.?

The concept of latent demand is rather subtle. The term latent typically refers
to something that is dormant, not observable, or not yet realized. Demand is the
notion of an economic quantity that a target population or market requires under
different assumptions of price, quality, and distribution, among other factors.
Latent demand, therefore, is commonly defined by economists as the industry
earnings of a market when that market becomes accessible and attractive to serve
by competing firms. It is a measure, therefore, of potential industry earnings
(P.I.E.) or total revenues (not profit) if a market is served in an efficient
manner. It is typically expressed as the total revenues potentially extracted by
firms. The "market" is defined at a given level in the value chain. There can be
latent demand at the retail level, at the wholesale level, the manufacturing
level, and the raw materials level (the P.I.E. of higher levels of the value
chain being always smaller than the P.I.E. of levels at lower levels of the same
value chain, assuming all levels maintain minimum profitability).

The latent demand for 235 to 240-pound organic-base asphalt strip shingles
excluding laminated shingles is not actual or historic sales. Nor is latent
demand future sales. In fact, latent demand can be lower either lower or higher
than actual sales if a market is inefficient (i.e., not representative of
relatively competitive levels). Inefficiencies arise from a number of factors,
including the lack of international openness, cultural barriers to consumption,
regulations, and cartel-like behavior on the part of firms. In general, however,
latent demand is typically larger than actual sales in a city market.

Another reason why sales do not equate to latent demand is exchange rates. In
this report, all figures assume the long-run efficiency of currency markets.
Figures, therefore, equate values based on purchasing power parities across
countries. Short-run distortions in the value of the dollar, therefore, do not
figure into the estimates. Purchasing power parity estimates of country income
were collected from official sources, and extrapolated using standard
econometric models. The report uses the dollar as the currency of comparison,
but not as a measure of transaction volume. The units used in this report are:
US $ mln.

For reasons discussed later, this report does not consider the notion of "unit
quantities", only total latent revenues (i.e., a calculation of price times
quantity is never made, though one is implied). The units used in this report
are U.S. dollars not adjusted for inflation (i.e., the figures incorporate
inflationary trends) and not adjusted for future dynamics in exchange rates
(i.e., the figures reflect average exchange rates over recent history). If
inflation rates or exchange rates vary in a substantial way compared to recent
experience, actually sales can also exceed latent demand (when expressed in U.S.
dollars, not adjusted for inflation). On the other hand, latent demand can be
typically higher than actual sales as there are often distribution
inefficiencies that reduce actual sales below the level of latent demand.

As mentioned earlier, this study is strategic in nature, taking an aggregate and
long-run view, irrespective of the players or products involved. If fact, all
the current products or services on the market can cease to exist in their
present form (i.e., at a brand-, R&D specification, or corporate-image level)
and all the players can be replaced by other firms (i.e., via exits, entries,
mergers, bankruptcies, etc.), and there will still be an international latent
demand for 235 to 240-pound organic-base asphalt strip shingles excluding
laminated shingles at the aggregate level. Product and service offering details,
and the actual identity of the players involved, while important for certain
issues, are relatively unimportant for estimates of latent demand.

For more information visit
http://www.researchandmarkets.com/research/69e033/the_2009_report_on

Laura Wood
Senior Manager
press@researchandmarkets.com
Fax from USA: 646-607-1907
Fax from rest of the world: +353-1-481-1716

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