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Astrid asked on Jun 21, 2018 - 10 answers
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10 answers

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Raghed replied on Jun 25, 2018

Phan replied on Jun 25, 2018
Looking for solid partner to practice case interview. My time zone is GMT +7:00

In order to estimate the number of gasoline station, I will break down it to 2 components: number of gas station = total of gas consumption per day / total gas pump of each gas station per day

To estimate total gas consumption, I will have 3 assumptions:

1/ Total population of Paris is 2 million

2/ Age range % population: 0 -> 18 years old: 20%, 18 -> 60 years old: 60%, > 60 years old: 20%

3/ Gas consumption per person per day for each age range:

+ 0 -> 18 years old and > 60 years old is 0 due to driving capability

+ 18 -> 60 years old is 1 litre per day

Total gas consumption calculation:

+ Total population of 18 -> 60 years old is 2,000,000 * 60% = 1,200,000 people

+ Total population of 0 -> 18 years old is 2,000,000 * 20% = 400,000 people

+ Total population of 0 -> 60 years old is 2,000,000 * 20% = 400,000 people

+ Total consumption of gas in Paris per day is 400,000*0 + 1,200,000 * 1 + 400,000*0 = 1,200,000 litre

To estimate total productivity of each gas station, I will have 3 assumptions:

1/ Productivity per working day:

+ 8:00 -> 16:00: 60% capacity (high traffic)

+ 6:00 -> 8:00 and 16:00 -> 22:00: 40% capacity (low traffic)

+ 22:00 -> 24:00 and 0:00 -> 6:00: 10% capacity (low and no traffic at mid night)

2/ Number of gas pump per gas station is 5

3/ Speed per gas pump is 1 litre/ 10 second

Total productivity per gas station calculation:

Speed per gas station: speed per gas pump * number of gas pump per gas station = 5 * 1 = 5 litre/ 10 second

Total working hour with high traffic time range: 8 * 60% = 4.8 hours

Total working hour with low traffic time range: 8* 40% = 3.2 hours

Total working hour with low and no traffic at mid night time range: 8*12.5% = 1 hour

Total working hour per day: 4.8 + 3.2 + 1 = 9 hour

Total productivity per gas station per day: 9 * 5 * 6 * 60 = 45 * 3600 = 16,200 litre

Total number of gas station at Paris: 1,200,000/ 16,200 = 74 gas stations

Enuma replied on Jun 24, 2018

To solve this problem I would start by making 2 key assumptions:

  1. France is similar to the United States in demographics and fuel consumption.
  2. The population of Paris is 3 million.

Then, I would estimate the number of people serviced by 1 gas station in my community (in the US), using this information I would calculate an estimate for the number of gas stations in Paris.

I live on a major road in Hartford, CT that feeds into several smaller (mostly residential streets and closes. There are 4 gas stations along this stretch and the estimated population of the neighbouhood it services is 20,000. Consequently, 1 gas station services 5000 (20,000/4) people.

Given the assumed similarity between France and the United States, The number of gas station in paris is 600 (3,000,000/5000).

Anonymous A replied on Jun 26, 2018

Hello,

This is a fantastic idea!

My answer is based on the following 2 facts.

  1. A 'gas station' is anything with >= 1 public gas supply pump.
  2. The analysis is for Paris Metro area.

As for my answer - I believe there are 100 gas stations within the metro area.

Workings:

  1. This is a demand problem as we can assume that if demand was not being met, there would be more gas stations opened.
  2. Popn = 2.2m Paris Metro
  3. % who can afford cars is 50%
  4. % who actually own a car is 1/6 = 16% = 176K~
  5. Avg car tank = 50L
  6. Avg Trip Km = 5
  7. Avg # Trips per week = 3
  8. Avg fuel per Km = 1
  9. Fuel used per week = 15L
  10. Therfore a car fills up every 3 weeks= ~ 50K cars per week use gas stations.
  11. Gas stations work 15 hours per day
  12. Avg Pump # is 3
  13. Pump flow is 30L per minute
  14. Utilization is 30%
  15. Avg fuel supply per day = 15 x 60 x 3 x 30 x .3 = 24,000L
  16. Total Avg station weekly supply = 24K x 7 = 168KL
  17. Total Fuel demand of paris = 50k cars x 50L tank = 2.5m L
  18. Therfore to meet this demand, there must be X number of stations
  19. X = 2.5m L Demand / 24,000L avg station supply = 100~ Stations

Tania replied on Jun 25, 2018

part1)

  • Paris population 2.2M, assume 3 people per household, 0.73M hoseholds
  • About 83% household own cars in France
  • 0.73*83%=0.6M cars

part2)

  • 2 cars are being filled up at the same time at each gas station
  • each car blocks a pump for 6 minutes, 60/6*2=20 cars
  • 1 gas station services 20 cars per hour
  • gas station hours from 8am to 10pm, so 14 hours each day
  • 14*20=280 cars per day
  • 280*7 days per week=1960 cars per week
  • Assume each car need to fill once a week
  • 0.6M/1960 cars=310 gas stations
Andrey replied on Jun 25, 2018

Technically, this answers the question (creative problem solving skills ftw :D ), so yes, your answer did land in our bucket ;) — Astrid on Jun 27, 2018

Rr replied on Jul 02, 2018

Hi..

Sorry for the late answer. Would be great if you guys could share some feedback on my approach.

Here goes,

Paris' energy consumption (surface transport) for 2006 :-

Gasoline : 68208 Tera Joules. (Calorific value of gasoline : 33.7 MegaJoule/litre)

Diesel : 138096 Tera Joules. (Calorific value of gasoline : 36.9 MegaJoule/litre)

Hence, annual consumption for 2006 equates to

Gasoline : 2024 million litres

Diesel : 3742 million litres

Considering the fact that France's oil consumption figures have reduced from 1.9million bbl/day in 2006 to 1.6million bbl/day, in 2017 owing partly to the advent of the affordable electric vehicles and pervasion of the same, let us consider 85% capacity in 2017 compared to that of 2006.

Hence, annual consumption figures of Paris for 2017 are

Gasoline : 1720 million litres

Diesel : 3181 million litres

Now, considering an even distribution of consumtion over the year, the average daily consumption comes to

Gasoline : 4.71 million litres

Diesel : 8.72 million litres

Now, let the average filling station in Paris cater to both gasoline & diesel consumers. On an average underground fuel tanks at filling stations have a capacity of 30~40kilolitres. The capacity is so selected to cater to an average of 3-day demand at the filling stations. There should be separate tanks for gasoline & diesel.

Let us consider one 30kilolitre tank with an average of 3 days capacity for diesel in a filling station. This gives us a daily consumption of 10kilolitres per filling station for diesel.

Therefore, a maximum of (8.72million litres(diesel) / 10kilolitres = ) 872 filling stations are there in Paris.

Similar calculation considering gasoline would give a figure of 471 filling stations. However, as diesel consumption is almost twice that of gasoline consumption, and owing to the fact that filling stations would prefer using similar capacity underground tanks owing to space constraints, economic & technical reasons, it seems that quite a few filling stations would be 'diesel only'.

Hence, let us go with a figure of 872 for this case.

Thanks,

Rr.

Astrid replied on Jun 28, 2018
PrepLounge Community & Marketing Manager

Hi Tom!

Thank you for your feedback to our answer :) Of course in our calculation tree, the reasoning is missing. In an actual interview, we would have to explain and justify it as the following:

Here is the logic behind the 78 vehicles/pump:

And this is how we came to 9 liters/vehicle:

What do you think?

You can also check out the full case study and solution to get all the details.

Best,

Astrid

PrepLounge Community Management

PrepLounge Consulting Q&A Forum

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This is definitely helpful for people to understand your logic in greater detail and help fill in some gaps. Definitely highlights the important to communciate what you're thinking and why to the interviewer! Thanks! — L on Jun 28, 2018

No worries, at all! Thanks for your input, Tom! — Astrid on Jun 28, 2018

Astrid replied on Jun 27, 2018
PrepLounge Community & Marketing Manager

Hi everyone!

It's time to draw the winner!

Congratulations, Phan Thien Phuoc! You won!

You will soon receive a message including your 6-week Premium Membership coupon!

[What we did was we assigned a number to each answer and drew the winner with an automatic number generator: (1 Raghed; 2 Phan Thien Phuoc; 3 Enuma; 4 Anonymous A; 5 Andrey; 6 Tania).]

Great job to everyone and thank you all for participating in our first Consulting Q&A Quiz!

Our PrepLounge team also gave it a try and this is what we came up with...

What do you think?

Good luck for the rest of your case prep!

Astrid

PrepLounge Community Management

PrepLounge Consulting Q&A Forum

Follow us on: Facebook | Instagram | LinkedIn | twitter

Honestly i feel as though this is missing a number of key steps in the logic. In an interview if you said randomly ' there are 78 vehicles per pumps' they are going to say how/why/explain? Althought its a leap of logic, working backwards it doesnt seem too far off but could use some further steps- so lets assume its correct for this question. However, likewise with the consumption of vehicles per day. 9L is ~20% of a tank in a day; this is not logical at all and means that a car is filling up once every 5 days. Realisticaly a car fills up once every 14 days, meaning the average L per day used is about 3. This would then throw the rest off, and make a more realistic number about 310 stations. I think having almost 1000 stations in the greater paris metro area is fairly un realistic. A quick google of registed gas stations also supports this, with about 500 being listed by a map search of the designated area: https://www.yelp.com/search?find_loc=Paris&start=0&cflt=servicestations&l=g:3.1661224365234375,49.40109831482049,1.5181732177734375,48.31694799688396 — L on Jun 28, 2018

I believe the interviewer would mark you down for saying a car used 20% of its tank in 1 day. Perhaps if we were talking about Texas and people drive large distances in massive, fuel thirsty cars that have say 90L tanks to begin with, 9L would be a fair assumption. However, for Europe (everything is smaller- cars, trips etc). Its fine if you dont know about car fuel consumption or the specific topic, but you are getting tested for being logical, therfore using the assumption of a 50L tank you need to refelct this logically as a % when considering how much gas a car would use/ how often you fill up. — L on Jun 28, 2018

Anonymous A replied on Jun 25, 2018

Can you please define Paris?

Good follow-up question! As a hint: The city district of Paris has a population of about 2 million. The metropolitan area of Paris has a population of about 10 million. Now it's up to you to decide which number to use for the calculation! :) Good luck! — Astrid on Jun 25, 2018 (edited)

You changed your answer which has thrown everyones calcs off!! — L on Jun 27, 2018

I don't see how my comment has thrown everyone's calculations off. They are all fine! — Astrid on Jun 27, 2018

There are now 2 answers = Paris City and Paris Metro. I asked you to define which paris area you asking us to estimate and you said Paris City as 2,2m. However now there are people using 10 million for the larger area. This means that there should be 2 different answers. How do we know which area to use for 'Paris'? — L on Jun 27, 2018

I believe that my initial comment was the hint to use "Paris Metropolitan Area". This was our approach, as we thought that the population surrounding Paris will drive to the city and use the petrol stations. However, this is not the ONLY correct approach (which is why I quickly edited my comment). When solving Marketing sizing guesstimate questions, it is more about the approach than the solution. If you can logically defend your approach to the interviewer, it is all that matters. In a real case, it is up to you to decide independently which area to use. I apologize that my edit has thrown you off guard and hope this helps! — Astrid on Jun 27, 2018

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