Core Qs to the Case

Question 1

External factors to consider when the company is retailer:

Answer 1

Consumer confidence
Disposable income
Unemployment rates
Gas prices

Question 2

External factors to consider when the company is manufacturer:

Answer 2

Dollar strength
Interest rates
Gas prices
Commodities

Question 3

The first FIVE steps to tackling a case:

Answer 3

1. Summarize the case,
2. clarify the objectives. And ask if there are any other goals or objectives,
3. Ask clarifying questions,
4. Label the case and create a structure,
5. State a hypothesis.

Question 4

Core Qs to ask about the company:

Answer 4

1. Profits and revenues for the past three years?
2. Customer segmentation:
   a. Characteristics?
   b. Changing needs?
   c. Profitability by segment?
3. Product mix?
   a. Cost/margins?
   b. Product differentiation?
   c. Market share?
4. Production capabilities/capacities?
5. Brand?
6. Distribution channels?
7. What constitute success?
   a. Which metrics to use?

Question 5

Core Qs to ask about the market:

Answer 5

1. Market size, growth rate, and trends,
2. Where is it in its life-cycle? (emerging, mature, or declining),
3. Industry drivers,
4. Customer segmentation,
5. Margins,
6. Industry changes: (MandAs, new players, chng. in Technology, and chng. in regulations),
7. Distribution channels,
8. Major players and market shares,
9. Product differentiation,
10. Barriers to entry/exit.

Question 6

Just for fun, what are some examples of barriers to enter a market?

Answer 6

1. Access to capital,
2. Distribution channels,
3. Access to raw materials
4. Technical knowledge,
5. Human talent,
6. Gov. regulations,
7. Customer loyalty,
8. Monopolistic features

Question 7

List the FOUR key case scenarios!

Answer 7

1. Profit and loss
2. Entering a new market
3. Pricing
4. Growth and increasing sales

Question 8

P and L: Qs about Rev. and Qs about Cost…

Answer 8

Rev:

1. What are the streams of revenue, and what % assigned to each?
2. Is there something unusual about the balance of percentages?
3. Have the percentages changed over time?

Costs:

1. Is there a shift in our costs?
2. Is there any unusual cost items
3. How does our costs compare to our competitors?

Question 9

Qs to ask when investigating the market to determine whether entry makes good business sense!

Answer 9

1. Who are our competition, and what share of the market they own?
2. How do their product differ from ours?
3. How are we going to price our products?
4. Are there any substitutes?
5. Are there any entry barriers?
6. Are there any exist barriers?
7. What are the risks associated with entering the market?

Question 10

Ways to enter a market:

Answer 10

1. start from scratch and grow organically,
2. Acquire an existing player,
3. Form a joint venture or strategic alliance,
4. Outsourcing.

Question 11

MandA: if question is about a private equity firm, don’t forget to ask about:

Answer 11

1. What else does the company own?
2. What is the purpose: hold, flip, or
   breakdown.
   (all related to synergies)

Question 12

What are the steps necessary to tackle pricing cases?

Answer 12

1. investigate the company’s objective,
2. investigate the product.
3. Determine a pricing strategy

Question 13

Pricing: What objectives might companies have for new products?

Answer 13

1. profits,
2. market share
3. brand positioning

Question 14

What are 3 types of pricing strategies?`

Answer 14

1. competitive analysis
2. cost-based pricing
3. price-based costing (is when buyers are strong enough to determine the price and usually also the quantity, thus our costs follow the price).

Question 15

Ways to increase volume/revenue:

Answer 15

1. Expand the number of distribution channels,
2. Create more product lines, especially if new products won’t eat sales from existing ones,
3. Analyze the segments of the business and determine which one offer highest margins,
4. Invest in marketing campaigns,
5. acquire competitors,
6. adjust prices
7. Create seasonal balance,
8. find niches in developing countries with high barriers to entry.

Question 16

Factors to consider when analyzing a case about starting a new business:

Answer 16

1. management team,
2. market and strategic planning,
3. distribution channels,
4. the product,
5. customers
6. finances

Question 17

Ways to cut costs:

Answer 17

PRODUCTION:
1. Import parts,
2. Consolidate suppliers,
3. Renegotiate with suppliers,
4. Outsource,
5. Reduce inventory,
6. Create flexible production lines,
7. Consolidate production space,
8. Invest in technology.
FINANCE
1. reduce AR,
2. Refinance debt,
3. Sell nonessential assets,
4. Hedge currency rates,
5. Redesign health insurance.
LABOR:
1. Institute company-wide pay decrease,
2. Contemplate layoffs,
3. Make employees owners,
4. Institute 10-hours 4 days rather than 8-hours 5 days.
5. Raise employee health care insurance premium,
6. Reduce 401 (K) match
7. Cut over time,
8. Cross-train workers

Question 18

Most important part things in an interview?

Answer 18

confidence

structure

Question 19

List 2 pros and 2 cons for each market entry strategy.

Answer 19

1. start from scratch and grow organically:
   Pros:
   a. control over design and quality
   b. High margin in the long run
   Cons:
   a. Requires defined/reliable distribution channels
   b. Requires knowledge and capabilities in manufacturing
   c. Takes time to enter a market
2. Acquire an existing player:
   Pros:
   a. Established brand and distribution channel
   b. knowledge and expertise in manufacturing
   Cos:
   a. Culture conflict
3. Form a joint venture or strategic alliance:
   Pros:
   a. Same as acquisition
   b. Lower initial costs
   Cons:
   a. Loss of control
   b. Higher performance goals to satisfy both companies
4. Outsourcing.