Case

Chewing Gum


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 don’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€œCase exhibits” 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

      This part of the case should be led by the interviewer, introducing the interviewee to the fundamentals of the banking sector.


      For the purpose of this solution we have made the following assumptions

        • Dallas airport handles 73 mn passengers annually
        • 50% of the passengers are transiting to a different destination; 30% gets into Dallas using taxis and the remainder using other modes of transport like personal cars, buses etc.
        • Of the customers who use taxis, 40% travel from 12:00 am to 6:00 am and 60% from 6:00 am to 12:00 am
        • Average trip duration is one hour
        • The taxis operate through the day (24/7), without any breaks for refuelling, maintenance etc.
        • The average fare for night time trips are $60
        • The average fare for day time trips are $40

        The candidate might make different assumptions which is fine. In this solution, only two cuts of the population are done – 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 𝐡×25%=250 π‘š
          • Consumption per year: 250 π‘šΓ—3Γ—12=9 𝐡
          • Market Value: 9 𝐡×0.50 $=4.5 𝐡$


        Others market value:

          • Rest of the consumers: 1 𝐡×75%=750 π‘š
          • Consumption per year: 750 π‘šΓ—1Γ—12=9 𝐡
          • Market Value: 9 𝐡×0.50 $=4.5 𝐡$


          Total market:

          4.5 𝐡$+4.5 𝐡$=9 𝐡$


          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 – Age, health
            • Some age groups may need to be excluded completely – Infants & toddlers, senior citizens etc.
          Exhibits
          Are you sure you will land your offer?
          Let’s make sure you are
          Getting into a top consulting firm is an investment that pays off every subsequent year of your career.
          Work with us