Casing tips

how do you conclude your case?

-recommendation (i recommend that we...)
-three reasons why you make this recommendation
-risks (while there may be risks in...)
-mitigants (i know we can solve them through...)
-next steps (for our next steps, i would like to look into...)

what is a breakeven analysis?

when your FC are exactly equal to your contribution margin

what are some economic barriers to entry?

-capital required to purchase equipment
-fertile land to grow grapes
-distribution channels and infrastructure

what two things do you always forget to focus on when you do your framework?

(1) MECEness (every point should be individual)
(2) Hypotheses as you move across your framework (what data or formulas do you want to focus on as you move across your presentation)

whenever you are given two/three scenarios to compare, what should you do?

-create table
-x and y axes

what should you focus clarifying questions on in the beginning?

-WHAT what is the product?
-WHO who are we selling to?
-WHERE are we selling to?
-WHY (what is our goal)?
-WHEN (is there any length of time we're selling for)?
-analytical and deeper questions should be asked as the case moves on

backup structuring for a case

-company, customer, competitors
-this framework usually focuses on long-term strategic solutions

what should you think about when thinking of distribution?

-who is our product being sold to?
-households? businesses (B2B)?

customer preferences

-when clarifying in the beginning, it's important to inquire about what is important to the customer about the product
-what should we prioritize as consultants?
-consultants know the company well but not as well as the company itself

why are hypotheses important?

hypotheses help us predict trends and focus on what is important to know if something unexpected happens

when solving for a number in a quantitative analysis what should you do at the end?

-ALWAYS put this number into context
-what proportion of the US population is this number?

amazon's recent quarterly gains in their web services

$143.31 billion

what formulas/math should you look into when given a case about investment?

-payback period
-return rate (IRR)
-discounted CF analysis (NPV)
-what is a good return rate in this industry?

how many ideas should you recommend when tasked with a qualitative question?

three to five ideas for brainstorming!

what is CRM?

customer relationship management (monday.com, Salesforce)

what should you do when coming up with next steps?

look back at framework and look at what points you didn't get data for or didn't get a chance to look deeply into

JUST REMEMBER

A CASE ALWAYS HAS TWO SIDES, THIS IS WHERE THE RISKS AND MITIGANTS COME IN

addition methods

-left to right addition
-subtraction for addition
-right to left addition
-chunk it out method

subtraction methods

-left to right subtraction
-addition for subtraction

multiplication methods

-left to right multiplication
-subtraction for multiplication
-factoring for multiplication (the number that isn't prime can be broken up into multiple smaller numbers)

division methods

-left to right division
-breakup division method (break up the larger number over the same denominator and then add them up)

what two factors should you consider after you've calculated a market size?

-average annual spend per customer (what's the replacement rate of this product?)
-how many people are buying this product from OUR company (competitors' share of this market)

replacement rate and adoption rate for medications

not all people with the disease choose to medicate themselves-some people just deal with the pain, can't afford, or don't know they have the disease

percentage calculation methods

multiplication for percentages
example: 54% of 1094 = 54(1094)/100 = 590

how would you use the rule of 72 to calculate how long it would take an investment to triple?

72 x 2 = 114
now this becomes the rule of 114!

what should you do after you present your framework?

-guide the interviewer where you would like to start
-always structure your framework in the region that you think is the most important

what are some costs associated with vehicles/trucking?

-insurance
-maintenance
-depreciation (products getting older)
-price/cost of each truck

payback period formula

# of years needed to recover initial amount paid = initial investment / annual CF

what's the difference between payback period and breakeven quantity?

-payback period is the time it takes to recoup your initial investment
-breakeven point measures the sales volume needed to cover costs

what should you consider when you use the top-down approach to market sizing?

make sure that when you divide age groups into segments, that you acknowledge that you are dividing linearly even though this may not be always accurate

squaring numbers methods

-squaring two or three digits (21 x 21) = 20 x 22 + 1^2
-basically just round one number, round the other number up by that number and then add that number (squared) you took off to the end

return on investment formula

ROI = net profit / cost of investment x 100

gross profit

-gross profit basically shows how efficiently a company uses their resources to produce and sell their goods
- gross profit revenues - COGS

operating profit

revenues - COGS - fixed costs (depreciation/amortization, excluding interest and taxes)

net profit

-revenues minus ALL YOUR COSTS!!!!
-usually companies try to make this number smaller for tax purposes
-other companies try to make this number big for potential investors

what should you consider when looking at beauty, health products?

consider GENDERS! women versus men

what are some considerations that are important to implement in considering a M&A?

-market attractiveness?
-is the company we're looking to acquire strong and trustworthy in the market?
-post acquisition capabilities?
-risks of acquiring the company (strategic fit, intellectual property, government regulations)

how would you use the rule of 72 to calculate how long it would take an investment to triple?

when you're solving for growth over three years...

make a chart to compare numbers throughout those three years

if you expand into a new type of product or M&A, what can happen?

cannibalization of your current market or product (have to make sure there's no overlaps!)

what are three ways to evaluate whether an investment is worth it?

- payback time
- discounted cash flows
- IRR (internal rate of return)
*oftentimes they will not specify which method to use*