Since the electronic repair industry is, operationally, a job-shop environment, it is somewhat difficult to estimate sales. For job-shops, each individual product or service is tailored or unique to that job, and is only initiated once an order is made. However, the sales forecast reflect the professional opinion of Mr. Munroe in how many sales he will make.
The sales forecast is based on the estimated number of electronics the company could service that are currently emplaced in the homes in Tucson. This is conservatively estimated at about two million units. From that number it is assumed that approximately 3% of all those will fail in any year. These two numbers multiplied together give us yearly market demand for our services. With an aggressive promotional strategy, a 10% market share is assumed by year three and multiplied by the estimated market demand. This is then multiplied by the estimated price per unit to arrive at the yearly sales figure assumed for year three (once the company's marketing efforts have paid off). This number is then decreased by a logical amount to estimate the first two years of revenue.