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Business Strategy: Home Delivery Solution for Retailer Chain
Kadara, a privately-held US retailer active in the Midwest with annual sales of approximately USD 3 bn, is trying to figure out a solution to last-mile home delivery. The company currently operates out of 100 brick-and-mortar stores selling primarily groceries and home essentials (e.g. paper towels, diapers, blenders). They also sell all non-perishable products offered in their stores through their website. Currently, all sales from their website are delivered via 3rd parties (e.g. FedEx, USPS), picking up products from regional distribution centers, and their minimum delivery time is next day. Kadara does not have out-of-store delivery options but they know that services such as Instacart and Postmates are being used by customers to arrange home delivery of groceries. Kadara's management believes that they are, at best, leaving money on the table due to their limited home delivery options and, at worst, at risk of being de-selected by customers as they move towards delivery options. Kadara’s future CEO, the granddaughter of the founder, has jumped on the chance to move the company into the future. To that end, she has developed a recommendation to Kadara's board to buy Dallas Drone Technologies (DDT). DDT designs, manufactures and operates small-to-midsize flying drones. Their initial models focused on aerial photography but they added goods movement capabilities about two years ago. The future CEO believes that drone delivery is key and that Kadara should buy DDT for USD 100 m to become a leader in the space. Kadara's current CEO would like your help specifically in evaluating the option to buy DDT and generally in how to think about home delivery and the future of their business.
Element Mobile expands into refurbished phones (MBB 2nd round)
Our client, Element Mobile (EM), is the largest German telecommunications provider, with an impressive supply chain comprised of dozens of suppliers, six distribution centres, and hundreds of stores. EM offers a variety of products to its 20 million customers, including sim cards, broadband, phones, and accessories, through its two sales channels, e-commerce and brick-and-mortar stores. Recently, Element Mobile noticed a decline in the sale of their device bundles. These bundles include a SIM and a phone, which are paid for in 24 equal monthly instalments. Since SIM plans are typically purchased as part of a device bundle, and accessories and broadband packages are usually sold as add-ons, the decline in device bundles has a significant impact on our entire business.The CEO of Element Mobile believes that this decline is due to a combination of market and consumer preferences, including the reduced discretionary income of consumers and a longer device ownership trend for environmental reasons. The CEO believes that one potential solution to their declining demand is to invest in a phone refurbishing facility that would allow them to offer affordable used devices as part of their phone packages. Such recycling programmes involve the collection, refurbishment, technical inspection, and repackaging of devices.
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TrendWardrobe
Our client is TrendWardrobe (TW), a clothing retailer in the US. It offers a wide range of fashionable clothing and accessories for men, women, and children. TW operates 200 stores across the top 50 cities in the US. These stores are typically spacious and situated in suburban areas. Additionally, TW has a robust online presence through its website, trendwardrobe.com. However, in the past two years, TW has experienced declining revenue compared to its competitors.A thorough analysis conducted by the strategy team at TrendWardrobe has revealed a significant decrease in customer visits. This indicates a decline in the number of unique shoppers visiting TW stores or making online purchases. Recognizing the need to reverse this trend and drive revenue growth, TrendWardrobe is exploring various measures to boost its performance over the next two years. The challenge for TrendWardrobe is to identify strategies and initiatives that will accelerate revenue growth and enable the company to regain its competitive position. By implementing effective measures, TrendWardrobe aims to attract more customers, increase sales, and catch up with its competitors in the clothing retail industry.
Practice Cases with Peers That Are Currently Looking for Interview Partners.
BCG Final Round: Stadium Naming Rights
Our client is NeuBank, a neobank in the US. A soccer stadium in Ohio is offering exclusive naming rights, and NeuBank is considering bidding for them. The client wants to understand the following:If this is a good idea?How much they should bid?How to make the deal a win-win?NOTE that this case is very long and is meant for learning casing skills. If you intend to use it for mock practice then focus on very specific segments to complete it in time.Also check out the video solution at the bottom of this page for a step-by-step work-along and detailed explanantion
Bain + BCG - Hot Wheels WITH VIDEO SOLUTION
Problem definition: Our client is Korean Car Parts (KCP), a multi-national original equipment manufacturer (OEM) of car parts based in Korea. They've recently seen a decline in profits and have brought us in to understand how to address this falling profitability.========================================================To get a deep-dive explanation of the case leadership behind this case, please read this article: Candidate-Led Cases: What to Expect With Example CasesThis case is part one of a series. The goal of this series is to demonstrate how an identical case prompt (and corresponding framework) could lead to multiple different outcomes. The goal is to train you to adjust to case information in an agile and adaptable way.The 2nd part of the series can be found here:Case - BCG Hot Wheels Part 2 With Video Solution
MBB - Sky China
Sky China, a government-backed Chinese airline, has recently seen profits plummet due to COVID-19. Profits are down 80% in the months of February and March, but are showing early signs of a rebound in April. They've brought you in to first investigate what can be done immediatedly to prevent hemorrhaging cash and surive in the short-term. They are also looking to see how the current situation can be viewed as an opportunity, and what can be done to prepare for the future.
StyleScape responds to customer feedback (McKinsey final round)
Style Scape is a mid-sized retailer that sells clothing, accessories, and home goods through its physical stores and online platform. The business has been around for over a decade and has seen consistent growth in sales in its home market of the United States. Style Scape operates 30 stores nationwide, and its online platform is relatively new, having launched only two years ago.Despite healthy growth, the company's leadership has noticed an alarming decline in customer satisfaction ratings and an increase in customer complaints. They are concerned that these issues will harm the company's reputation and negatively impact its bottom line. The CEO of Style Scape has requested your assistance in determining the root causes of these issues and developing recommendations to address them.
Baby Formula
BabyformulaCo is a leading producer of baby formula with a 30% market share in the US that is looking for ways to increase their market share without significantly lowering profitability. Recently, a Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) for low-income women and their children was introduced, which provides vouchers to purchase baby formula.The client is interested in bidding for the tender contracts but needs help in determining the appropriate bidding price.
Russell University - Fresh Attacker on the Online Education Market (McKinsey 1st round)
Russell University, located in the United Kingdom, is one of the oldest and most prestigious universities in the world. They have been educating students for more than two centuries and provide a variety of undergraduate and graduate STEM-focused courses. In an effort to increase revenues and expand their reach, the university has recently begun offering three online postgraduate qualifications. Despite the quality of teaching and effort spent in developing these courses, the response from students in terms of sign-up rates has been modest. Russel University executives believe they are acting too slowly since other prestigious universities, particularly in the US, have successfully leveraged their brand to offer short and affordable online courses to a variety of people. Russell University has hired us to determine whether they should acquire Eduline, a well-established platform that offers STEM-related short courses to its subscribers. The university intends to use Eduline to offer courses on a subscription basis and will then issue online certificates to individuals who successfully complete its courses.
Hara Coffee Co's innovative coffee subscription model
Our client, Hara Coffee Company, is a large coffee chain with over 200 locations in the United Kingdom. They import beans from numerous regions and batch-roast them in the UK, offering customers a vast selection of premium blends. In addition to serving delicious coffee, our client offers freshly made sandwiches, pastries, and salads of the highest quality. Hara Coffee Co. is also one of the most socially and environmentally responsible coffee brands in the United Kingdom, and their value proposition heavily relies on customers paying a premium for delicious products that do not compromise on sustainability metrics.The rising cost of living has significantly reduced the revenue of coffee chains throughout the United Kingdom over the past year. People are increasingly choosing to brew their own coffee at home, with beans delivered by subscription. The CEO of Hara Coffee Company is intrigued by the expansion of coffee subscription models in the UK. They requested that our team investigate whether their chain could also introduce a coffee subscription model, in which customers pay a fixed monthly fee and receive a certain number of coffees throughout the month.
GlowMobile Goes Digital (McKinsey first-round)
GlowMobile is a leading telecom operator with a strong presence in Southeast Asia. They sell regular products and services that any telecom operator would offer in their retail stores: cell phones, SIM cards, subscriptions, etc.Even though the number of digital customers in the region has grown exponentially, currently GlowMobile does not have an online presence and customers must go in person to retail stores for every interaction with the operator. In the past years, they have been losing a lot of customers due to bad customer experience.GlowMobile has asked our team to improve customer satisfaction through digitization. Specifically, they want us to help improve and digitize their operations and prepare a proof of concept for a digital customer journey for customers.The CEO believes that opening their digital channel would minimize the loss of customers due to bad customer experience and solidify their position as market leader. Right now, a digital journey does not exist.
BCG Final Round Case - Sugar to Indonesia
Our client is an Indian sugar producer exporting solely to Indonesia. Indonesia imports 5m tons of raw sugar per year.To make raw sugar, our client processes sugarcane at a cost of $25 per ton and they have a capacity of 1.5m tons per year. The only competitor that has lower production costs is from Thailand, and it delivers 1.7m tons per year at a cost of $20 per ton.Our client recently found out that the Thai producer will expand its production to 2m tons, and as a consequence the market price for sugar in Indonesia may drop.They contacted us to assess this situation.
BoxxFitness Gyms
Our client is the CEO of BoxxFitness - a leading gym chain in the US with over 1,500 gyms. BoxxFitness is a premium gym concept with an annual membership fee that is 2-3x higher than most mainstream gyms. Each gym has a limited number of membership slots. Each member gets a dedicated locker, unlimited personal training, unlimited classes, and unlimited equipment usage. In the last 3 years, the chain has seen a decline in its profit margin.Can you identify the potential reasons for this decline?
Merger of two beer manufacturers
Our clients are two beer manufacturers from a well-developed country who just decided to merge. We can call them Company A and Company B. The decision about the merger has already been taken and our clients are certain it will soon be approved by regulators.What is expected from you is to help them with two objectives: Firstly, they would like you to help them decrease the costs of their post-merger operations. Secondly, they would like you to help them develop a new marketing strategy.How would you like to go about helping our clients?
Changes in cookies market
Your client is a US-based manufacturer of branded cookies, Gumbread Inc. The client realized that their sales have declined in recent years. The client wants to know what they should do to do drive sales again.
Sprinker
Sprinker is a mid-sized, US-based publishing agency that develops, produces, and sells educational materials. It has come to their attention that some private schools are considering changing their first-grade textbooks, for which they would need a publishing agency.Sprinker is interested in participating in the closed tender and wants to determine whether this would be economically viable.
The Madhouse Animation Crisis
Your client is Madhouse Studios, one of the largest anime producers in Japan. The anime-industry is flourishing. Originally revenue was generated mainly in Japan but the trend is that revenues outside of Japan are growing at a steady rate of 15% a year as more and more non-Japanese people enjoy anime. Despite this rapidly growing new segment, Madhouse lost $6m in profits at the end of 2017 even though profits were growing steadily the years before.Madhouse has given you the objective to find the root cause of the loss in profitability and to advise them on how to proceed from here.
A DSL Provider
Your client is a large company in the Polish telecommunication sector, providing and maintaining the infrastructure for telephony and ADSL and offering services like phone & internet subscriptions and televison to consumers. As in most countries, the regulator has ruled that new entrants must be given access to the infrastructure to offer their own services. For competitive reasons, the company asked you to assess whether under the current environmental conditions a competitor (let's call the hypothetical competitor NewCorp) could run a profitable business offering consumer ADSL services.
Europe Rail Tunnel
The airlines covering the Cologne to London route are facing a competitive threat from a new rail tunnel connecting Britain and Germany by train. Which all factors do you think the airlines should consider before reacting to this threat?
Toothbrush disruption
We are a global toothbrush producing company. Our portfolio consists of two kinds of toothbrushes - 'manual' that sells for $5 and an electric 'rechargeable' that sells for $60. Last year, a competitor introduced a battery-powered electric “spinbrush” that sells for $8.5 and now has 2% of the toothbrush market. We don't have a similar offering and would like you to tell us whether we should develop a similar product or not.
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