## Problem Definition

Your client is a **chewing gum manufacturer in the United Kingdom** and you’re currently at the airport waiting for your flight. In the time that you have, you’re thinking about **how big** the **annual **chewing gum market is in the UK in terms of **market value.**

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## Comments

This is a market sizing/estimation case so there is no right answer, but only a right approach.

Candidate should lay out his/her structure to estimate total market size. The request is for total market value so candidate is expected to give a monetary value.

## Short Solution

Annual market value is an estimated **$1.28 b.**

## Detailed Solution

Paragraphs highlighted in green indicate diagrams or tables that can be shared in the “Case exhibits” section.

Paragraphs highlighted in orange indicate hints for you how to guide the interviewee through the case.

Suggested case structure:

### I. Structure

Candidate should think about a **structure **first and explain this to the interviewer before starting to make **assumptions. **

When the structure is clear, candidate can **start estimating** by making his **own assumptions** without help from interviewer.

If candidate seems lost or needs help, interviewer can assist by giving hints below:

- First, assume
** total population** of the UK.
- Secondly, think of
**which age group** represents a heavy user of chewing gum or which age groups represent which consumption ratio.
- Thirdly, estimate how many gum-packs are being consumed per consumer (per week, month and/or year).
- Estimate price of a pack of gum and calculate total annual revenue.

### II. Analysis

We can make the following assumptions for our analysis:

- UK population is
**80 m**.
- Heavy user-group is between
**10-20 years **old and represents** 20%** of total population. Each user consumes **1 pack** of gum per **week**.
- The remaining population of
**80%** consumes** 1 pack** of gum per **month**.
- Estimated
**price **of a pack of gum is **$0.80. **

### III. Solution

**Heavy-user target group**

- Heavy-user consumers: 80 m*20%=
**16 m.**
- Heavy-user consumption per year: 16 m*52 weeks=
**832 m.**
- Heavy-user market value per year: 832 m*$0.80=
**$665 m.**

**Rest of population**

- Rest of population: 80 m*80%=64 m.
- Consumption per year: 64 m*12 months=
**768 m.**
**Market value per year: 768 m*$0.80=$614 m.**

**Total market value**

**$614 m+$665 m=$1.28 b**
**Total estimated market value per year is $1.28 b.**

## Difficult Questions

- Which drivers affect consumption of chewing gum per person?
- How would changes to your assumptions affect the market size estimation?