Everything upstream of the capture rate is context; everything downstream is arithmetic. The rate itself is the assumption that decides the deal.
Reduce any market study to its essence and one number remains: of the demand quantified in the trade area, what share does the project capture? That rate converts market context into the revenue line, which converts into coverage, which converts into a determination. It deserves more scrutiny than any other assumption in the file — and in weak studies it gets the least, appearing fully formed in a single sentence.
A defensible capture rate is built from supply share and adjusted from evidence. Start with fair share: the project’s capacity as a fraction of total competitive capacity at stabilization. Then adjust for the factors that move share — location quality against the competitive set, product superiority or age, price positioning, brand or franchise pull — each adjustment named and bounded. A project claiming twice its fair share carries the burden of explaining why, comparable by comparable.
The derived rate should then face two tests. The benchmark test: do operating comparables in similar markets actually achieve this share? The absorption test: how long does reaching the stabilized rate take, and what does the ramp cost? Wert-Berater builds dedicated capture-rate tabs in the financial model so the lender can flex the rate directly and watch coverage respond — the most honest sensitivity in the study, because it is the assumption most likely to be wrong.
When a determination is conditioned, it is frequently this number doing the conditioning: feasible at a capture rate the evidence supports, with the gap to the sponsor’s rosier figure stated plainly. The discipline matters most where one assumption carries the whole projection, as it does in a car wash feasibility study, where capture and membership penetration together decide coverage.
President, Wert-Berater, Inc. — independent feasibility study consultants since 1998. 4,000+ engagements completed across all 50 states and internationally, evaluating $41.2 billion in project value for SBA, USDA, EB-5, conventional, and institutional financing decisions. Fiduciary duty runs to the lender and agency in every engagement.
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