The percentage of an industry or sector that a single company controls. For example, if Retail Company A conducts 10% of all retail
sales in the United States, it is said to have a 10% market share or penetration. It is important that a company, especially a large company, maintains a substantial market share in order to remain
competitive. However, companies that achieve too high a market share through
mergers,
acquisitions, or other methods may become regarded as
monopolies and violate local
antitrust laws. Some companies have a large market share compared to their competitors, but not enough to be considered a monopoly: these are called
gorillas. See also:
Herfindahl-Hirschman Index.