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[Question] Market Sizing - Estimate the average office printing cost of a large corporate bank

Market sizing
New answer on Jul 26, 2020
2 Answers
1.7 k Views
Anonymous A asked on Jul 25, 2020

Hi guys, I'd like to know your thoughts on this market sizing question:

"Estimate the average office printing cost of a large corporate bank"

Thanks a ton!

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Ian
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updated an answer on Aug 26, 2021
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate

Hi there,

Well, the first question is top-down or bottom-up. I think you could do both, but bottom-up feels more thorough + logical.

Bottom-up

  • Number of sheets of paper printed per floor
    • Number of employees per floor
    • Number of papers printed per day per employee
  • Cost per sheet of paper (or per 100)
    • Perhaps differentiate between color and black/white (take, say, 20% of total for color)
  • Number of floors + buildings for the bank

Top-down

  • Total typical expenditures for a large corporate bank
  • SG&A costs %
  • % of SG&A that would be spent on paper

Take a look here for additional practice! https://www.preplounge.com/en/management-consulting-cases/brain-teaser/intermediate/taxis-in-manhattan-market-sizing-229

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Anonymous A on Jul 26, 2020

Thank you for taking the time to articulate your approach, it's very helpful!

(edited)

Axel
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updated an answer on Jul 26, 2020
Bain Consultant | Interviewer for 3 years at Bain |Passionate about coaching |I will make you a case interview Rockstar

I would agree with Ian's approach and that using a bottom-up approach will yield the best results. You could also try to factor in the cost of the printers themselves to get an even more accurate answer (See below)

Number of employees

x

Sheets of paper printed per day (x 365)

x

% black and white / vs. color

x

Cost per paper and ink (black & white / color)

+

Number of printers (can be derived assuming how many employees share one printer)

x

Annual depreciation $ (Assume average price for a printer and divide by useful life)

-A

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Anonymous A on Jul 26, 2020

That's a good point, thank you for sharing your approach. It really helps me to structure and be more comprehensive when facing this type of not-so-regular market sizing question.

(edited)

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