I already mentioned about showing how Levels of each Pokemon and their potential works now let's see.

Pokemon potential and levels are clearly classified into ;-

Lv0~9 youngster- who are new born Pokemon are Pokemon who won't have talent in Pokemon battles

Lv10~19 novice- Pokemon who cross the infant stages and also used in early stages of Pokemon battle like Catterpie,wurple and other bug type Pokemons.

Lv20~29 ordinary- Pokemon who are little strong and used for early Pokemon gym battles.

Lv30~39 pseudo gym- Pokemon who cross the threshold of fighting against mid level Pokémon gyms like Jasmine,Ericka etc..

Lv40~49 gym - Pokemon who are strong to fight the fully trained teams of gym leaders example blanies, Claire's etc.

Lv50~59 pseduo-Elite- Pokemon who are strong enough to fight against one elite four member like Bruno,Aaron etc..

Lv60~69 Elite- Pokemon who are strong enough to desimate the full lineup of elite four.

Lv70~79 champion- Pokemon who are strong enough to go toe to toe with a regional champions ace like lance, Steven, Cynthia etc..

Lv80~89legendery - Pokemon who are strong enough to fight the new legendary Pokemon like Nolan's articuno, Tobais Darkrai etc..

Lv90~99 elder - pokemon who are strong enough to fight against the mid level legendary Pokemon like tapu Koko,Lilly etc..

Lv100~109 ancient- Pokemon who are strong enough to fight against strong and elderly level legendary Pokemons like dialga, plakia, giratina and hoopa etc..

Lv110 Arceus(without plates) - Pokemon who crosses the threshold hold of 110 can rival Arceus example none.

Lv???Arceus(with plates) -pokemon who are omega level none have reached this level.

The potential signify's how far can the Pokémon reach its full might.