Assume client is a grocery store and they've seen profits decline and want to fix this. If the structuring question is What are some factors you would look at to help the client improve profitability in a year?
Can I say this. I'd look at 2 areas -- 1st bucket: internal factors (mention 3 sub-buckets: current rev, new revenues, costs).
1) Look at ways to Improve current revenues
- increase prices (eg offer better service like fast delivery of items)
-increase # of grocery items sold (eg run promotions, bundle complementary items like salt & pepper)
2) generate new revenues (give 2 examples of how)
3) reduce costs (give 2 examples of how)
Then I'd look at 2nd area: external factors (mention 2 sub-buckets: competitors and customers)
1) competitors (who are strongest competitors, what differentiation do they have in products or service, what prices they charge)
2) customers (what are their preferences in terms of product selection, shopping experience. Are they price sensitive)
Is this a good way to think about the prompt? Or should I also start getting into reasons for why profits have declined by giving 2 examples for decline of each driver (like why price or quantity may have decreased).
I find “what factors” to be quite confusing in terms of what they are expecting for scope (reasons for why this is happening or ideas to fix this?)
