Market sizing: how many people work to deliver food in HK in 2021

Hi Ruizhi,

First of all, it is great to see your consistency in finding out the solution to the question!

This is indeed an interesting question which is probably relevant for quite a lot of users, so I am happy to provide my perspective on it:

• Generally speaking, your approach seems to be fine.
• Still, I would advise you to (re-)consider the following aspects of your market sizing:
  • Think carefully about the underlying drivers of the usage of delivery food. To my understanding, unless the dynamics in China are vastly different, the key underlying drivers are 1) age (i.e. small children and very old normally are not able to order delivery food) and 2) household income. Based on this, I would advise you to segment the Chinese population in a different, maybe more efficient way.
  • I do not fully understand the difference between “Penetration rate”, “# of HKers ordered meals” and “Frequency of purchase/ week”. To my understanding, there is the share of people in a given segment that use delivery food and there is the average frequency of purchase/ week for those that use delivery food. Still, it seems that you are using 3 factors. Why is this the case? 
• Lastly, for market sizing questions (in this specific situation), you can do two types of sanity checks:
  • Quantitative sanity checks: You might include simple quantitative sanity checks by setting your calculations equal to the results, by typing e.g. “XX+YY+ZZ=AA”
  • Reality checks: You might as well simply google on the market size of delivery food. Even if you do not find the figures for HK, you could most probably find the information for comparable cities.

In case you want a more detailed discussion on how to best approach any type of case study question, please feel free to contact me directly.

I hope this helps,

Hagen