How do you calculate the percentage of Customers to keep profit margin stable?

Oliver Wyman case: Full Electrons Ahead
New answer on Aug 06, 2020
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Franziska asked on Aug 05, 2020

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Ian
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replied on Aug 06, 2020
BCG | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

Hi Franziska,

This is a classic breakeven!

So, first, create the full formula, and then pulg-in what's missing.

  1. Profit from warranty* % quantity sold = Profit loss from car
  2. (Revenue from warranty - expected cost from warranty) * quantity sold = Profit loss from car
  3. (2,350 - 1,100) * quantity sold = $1,000
  4. 1,250 * quantity sold = $1,000
  5. Quantity sold = 1,000/1,250 = 80%
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Ian

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