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Case

# Chewing Gum

Difficulty: Beginner
Topics:

Case prompt

You have been staffed today as a consultant for a large Chewing Gum manufacturer in India. You are on the way to the airport, travelling with a friend and you tell him about the staffing. The friend asks you how large is the Chewing Gum market in India in terms of market value. You donβt know the number yet, but can you estimate it for him during the time it takes you to reach the airport?

Detailed solution

Paragraphs highlighted in orange indicate hints for you on how to guide the interviewee through the case.

Paragraphs highlighted in blue can be verbally communicated to the interviewee.

Paragraphs highlighted in green indicate diagrams or tables that can be shared in the βCase exhibitsβ section.

## Suggested case structure

Key question: What is the market size of chewing gum market in India?

Allow the interview to layout a case approach. If the structure is laid down, he can make his own assumptions and calculate the market size.

Suggested approach:
1. Assume the total population of India
2. Think about the age groups which are likely heavy users of chewing gum and estimate the proportion of people in the different age groups
3. Assume the usage per consumer per week/month/year
4. Assume the price per pack of a chewing gum

If the interviewee struggles with the above approach, prompt him by giving a few hints on the structuring of the problem.

## 1. Analysis

The below structure would be useful to perform the analysis.

The candidate might not draw out the very same structure, which is ok. However, do check (s)he adopts a similar approach

Exhibit 1

If needed, share Exhibit 1 with the interviewee

The candidate might make different assumptions which is fine. In this solution, only two cuts of the population are done β heavy users and non-heavy users; but the candidate might assume different categories.

The candidate can now use his assumptions to calculate the market size.

Heavy user market value:

• Heavy user consumers: 1 π΅Γ25%=250 π
• Consumption per year: 250 πΓ3Γ12=9 π΅
• Market Value: 9 π΅Γ0.50 \$=4.5 π΅\$

Others market value:

• Rest of the consumers: 1 π΅Γ75%=750 π
• Consumption per year: 750 πΓ1Γ12=9 π΅
• Market Value: 9 π΅Γ0.50 \$=4.5 π΅\$

Total market:

4.5 π΅\$+4.5 π΅\$=9 π΅\$

Key insight

The market size of chewing gums in India is 9 B\$

## 2. Other factors

Prompt the candidate to focus on other factors that should be considered

Potential other factors and costs to be considered include (but are not limited to):

• Drivers that affect consumption per person β Age, health
• Some age groups may need to be excluded completely β Infants & toddlers, senior citizens etc.

Exhibits

#### Exhibit 1

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