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The extant literature on marketing planning defines total market potential as the maximum amount of sales available to firms in an industry during a given period under a given environmental conditions (Bennet & Robson, 2001; De Steur, Liqun, Van Der Straeten, Lambert, & Gellynck, 2015). In the biomass sector, market potentials are often constructed using techniques such as substitution analysis and expert judgments (Makridakis, Wheelwright, & Hyndman, 2008).
To illustrate, Dornburg, Hermann, and Patel (2008) estimated market potential of biobased chemicals for the European region using the rate at which biobased chemicals substituted for petrochemicals. If the substitution rate is 100% for biochemical x, then the future market demand of reference petrochemical is taken as the market potential for x. These findings generalize as follows:
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Premise 1: The rate at which one material substitute for another is related to its relative utility; often utility is equated to market demand (Stein, Ayers, & Shapeneso, 1975);
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Premise 2:z per cent of biobased chemicals are substitutes of petrochemicals;
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Conclusion:z per cent of market demand for petrochemicals constitute market potential for biobased chemicals.