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Free toolsTAM, SAM and SOM

TAM, SAM and SOM, built from the bottom up

Count the buyers, price the category, then take the share your capacity can actually serve. The arithmetic is shown line by line, because a share-of-a-large-market claim is the classic unfundable market section.

Households, businesses, or people in the catchment. Write down where the figure came from — a market section without that is the classic rejection.

The ones who have the problem and could pay to solve it.

What one buyer spends on this category in a year — not what you would charge them.

Constrained by geography, channel and capacity. This is where most sizings quietly cheat.

By the end of the plan horizon.

TAM

$20.2M

SAM

$4M

SOM

$161.3K

The arithmetic

Shown line by line, because a market section that states a number without a derivation is the single most common reason one gets sent back.

  1. people in the catchment

    120,000

  2. Of whom are plausible buyers

    42,000

    35% of 120,000

  3. Spend each per year

    $480

  4. Total addressable market

    $20.2M

    42,000 × spend

  5. Serviceable, given where and how we sell

    $4M

    20% of the total

  6. Obtainable inside the plan horizon

    $161.3K

    4% of serviceable

    336 customers at this spend

That obtainable share is 336 customers.

This is the line to check first. Can you actually serve that many — with the premises, the staff and the hours you have modelled? Most market sections that do not survive contact with a reader fail right here, not on the TAM.

In the product this sizing is cross-checked two further ways: against a published market figure, which is inadmissible without a dated retrievable citation, and against the revenue your own model projects for year three. A plan whose model outruns the market it claims is caught before it is sent.

How this is computed

Founders writing a market section, and anyone who has been told their market size is not credible and cannot see why.

  • TAM is the qualified population times what one of them spends in a year. SAM narrows it to what your geography, channel and capacity can reach. SOM is the share of that you expect to hold.
  • Every step prints its own working, so the result reads as a derivation rather than a number.
  • The implied customer count comes back out of SOM, which is the figure an operator can check against their own capacity — most impossible market sections fail here first.

What it will not tell you

A calculator that lists only what it does is a toy. These are the limits worth knowing before you quote the answer to anyone.

  • A top-down cross-check needs a dated, retrievable source. In the product an uncited published figure is inadmissible rather than quietly accepted, and this page follows the same rule.
  • Bottom-up sizing is only as good as the population count. Write down where yours came from.

This number belongs in a document that agrees with it.

The full plan links every one of these together and blocks export until the prose and the model reconcile. Free to generate and read.

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