Measure market concentration from the market shares of competing firms.
Highly concentrated market.
Please do not make financial decisions based on these results.
What is the HHI Calculator (Herfindahl-Hirschman Index Calculator)?
Measure market concentration from the market shares of competing firms. To use the HHI Calculator (Herfindahl-Hirschman Index Calculator), enter market shares in %; it returns hhi, firms counted, total share entered, and shows them instantly as you type.
Where the HHI Calculator fits
Measure market concentration from the market shares of competing firms. The main figure it returns is the HHI, worked out from the values you enter.
It belongs with the other business planning tools. If you are comparing options or checking a result from another angle, try the Lerner Index Calculator, Profitability Index Calculator or the Direct Material Price Variance Calculator.
How to use the HHI Calculator (Herfindahl-Hirschman Index Calculator)
- Fill in the fields. You will need Market shares in % (comma separated). Use figures from the same period (same month, quarter or year) for every field. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the HHI, and the cards below show Firms counted, Total share entered. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the HHI Calculator (Herfindahl-Hirschman Index Calculator) using the default values shown in the calculator above:
Inputs
| Market shares in % (comma separated) | 40, 25, 15, 10, 5, 5 |
|---|
Results
| HHI | 2,600 |
|---|---|
| Firms counted | 6 |
| Total share entered | 100% |
With these inputs the calculator returns HHI: 2,600. Change any value in the calculator to see how the result moves.
What the results tell you
The results panel of the HHI Calculator (Herfindahl-Hirschman Index Calculator) reports HHI, firms counted and total share entered. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
What HHI level signals concentration?
Below 1,500 is competitive, 1,500 to 2,500 moderately concentrated and above 2,500 highly concentrated under common guidelines.
Can I use these for a business plan?
Yes. They give quick estimates for break-even, valuation, budgets and project returns. Confirm important figures with your accountant before relying on them.
Are the results forecasts?
No. They apply the formula shown to the numbers you enter, so the output is only as realistic as your assumptions.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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