Hello!

How long should I take to structure a market sizing question and to solve it?

Hello!

How long should I take to structure a market sizing question and to solve it?

expert

Expert with best answer

Hello!

How long should I take to structure a market sizing question and to solve it?

6 answers

Hi,

It really depends on when do you have a market sizing question. There can be two options:

**Market sizing as a standalone case**(You ask relevant clarifying questions (e..g. to exclude b2b) make a very detailed structure. Use 2-3 deep segmentations while solving the case, etc)**Market sizing in the middle of the case**(You do it as fast a possible - 80/20, capacity / occupancy instead of complex segmentations)

It's less about different types of the problems but rather about the tools that you use:

1) First of all, there are **2 ways to structure market sizing:**

- Formula - basically a math formula to come up with a solution. The problem with the formula is that it is easy to forget something or get lost.
- Tree - same as with regular cases you build a tree. A very simple example: you need to calculate the number of dogs on manhattan. A number of dogs = share of households having a dog * # of households. # of households = population / average household size. In the end, you'll have a pyramid where you have to fill the numbers on the base of the pyramid. This approach is much easier and help you track all the numbers

2) You should **learn the key market sizing techniques:**

- Making assumptions based on personal experiences (Use the example of your house where out of 100 apt-s 10 have dogs)
- Adjusting numbers (NY is a busy city thus fewer people have dogs)
- Sanity check - try to apply your calculations to the real environment
- etc.

3) You should **learn the key tools:**

- Using age even age split (suppose life expectancy is 80 years. Assuming even age split we have 4 mln people in US of each age)
- Using 80/20 split (suppose 20% people earn 80% wealth and the average salary is xx...)
- Using approximations (Length of NY-SF flight and plane speed to calculate US length)
- etc.

4) Learn **key numbers: **populations, gas price, gas consumption, Boeing speed and nmber of seats, average salary, # of gates in the airport, GDP growth rate, inflation, etc.

5) **Practice 10-15 cases** and you'll be fine. Almost all casebooks have good market sizing examples and the solutions

Feel free to PM for clarifications

Good Luck!

Thanks a lot, this is really helpful! — on Dec 06, 2019

Hi there,

I recommend to take less than a minute in order to:

1. Define the boundaries of the market sizing (type of product, customers, etc..)

2. Write the main formula, trying to include all the important elements

Than the interviewer will guide you and you break down together the formula. Of course if the market sizing problem is easy you can break down the formula during the first minute, but I would say it is better to do it together with the interviewer.

(edited)

Thank you! I was confused whether we should do the whole breakdown within a short period of time, which for harder questions seemed impossible to me. So this clarification really helped me out! — on Dec 06, 2019 (edited)

Your really welcome! if you have further questions do not hesitate to text me — Alessandro on Dec 06, 2019

Hi,

it depends on the problem. Usually, it's a normal case of 20-25 minutes, but if the interviewer says there will be another case after you will understand you are supposed to have 10 minutes as well as if it a part of a bigger business case

Hope it helps,

Anto

These general questions are super dangerous, since none can really give you an insightful answer with such little contest.

It depends! On the prompt, the case, how much info you already have, how complicated it is...

When preparing for consulting, try to avoid general recipies/frameworks/timings because that is not the way it works.

Hope it helps!

Cheers,

Clara

Hi,

On average, you should take about a minute to gather your thoughts and structure your main equation, with components laid out clearly.

In terms of the actual solution, it depends on whether the market sizing question is asked as a standalone question or is a part of a full-length case:

- Standalone: 20-25 minutes
- Part of a full-length case: 5-10 minutes

Best,

Deniz

I was wondering how long the whole process would take, so thank you! — on Dec 06, 2019

Generally speaking you should take around 20-25 minutes but the interviewer will guide you in this, telling you which hypothesis you can do to semplify the case.

Take into consideration that sometimes they want to do more than one market sizing.