Our client is Top Apparel. They own a portfolio of 15 brands of fashion. Historic growth has been in line with the market and the company is making good profits. Now management wants to invest money to grow the portfolio, but they are unsure on how to prioritize investment.
The client has asked us to help them determine which brands should get investments for future growth.
This is a primary qualitative case and includes reading graphs and data-tables to help you get to a solution.
Paragraphs highlighted in green indicate diagrams or tables that can be shared in the “Case exhibits” section.
Paragraphs highlighted in blue can be verbally communicated to the candidate.
The following framework/structure provides an overview of the case:
The candidate should ask for more information on revenue, size & growth in order to determine how the brands are performing and which ones have more potential for growth.
Interviewer can have a brainstorm discussion on approach or structure or share the data with candidate to let him run the analysis.
Share Table 1 with the candidate.
Share Table 2 with the candidate.
Share Table 3 with the candidate.
Candidate should point out the following based on the data:
- Based on the data we can see that all brands vary in size across the classic & contemporary segment.
- Contemporary segment has a higher projected growth of 4% vs. 1% of the classic segment.
- Brands B, E, H, K & M are the largest brands in terms of revenue.
- It seems brand E is making a loss, so we ought to focus on four of the five biggest brands for investment.
High Apparel should focus on brand B, H, K & M to invest for further growth as the largest brands are profitable with fast growth rates.
Is there a way to restore profitability for Brand E?