Market share is the percentage of revenues earned by a company within an industry compared to total revenues within the industry. It provides a method of determining a company’s size by revenue compared to similar companies.
One way of measuring market share is by determining its revenue in proportion to the total revenue earned by the other companies in its market over the course of a certain period.
By itself, market share is not good or bad. It is measured across some determined amount of time, such as a year. This allows for comparing current year market share to previous periods to determine if market share is growing or shrinking. Additionally, market share for the entire industry can be measured in the same way, providing an overall trend for the industry.
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