Bain & Company Interview Questions, Process, and Tips

Q1. Tell me about yourself.
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Q2. A question on my overall experience at both the companies I worked at previously.
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Client is global IT company who is facing problem with revenues from new client. Please help.
[Please note that I stands for Interviewer and C stands for Candidate]

After the initial introduction, there was a small conversation on industries which she works on.

I: I have given a case from the industry which I specialize. If you want, we can do a case from some other industry.

C: I can try. Can I ask questions about processes specific to the industry, wherever relevant?

I: Sure, I will help you with industry specific practices.

C: Reiterated the problem statement and asked Preliminary questions (CPCC), questions relevant to the case, how long the problem has persisted? The definition of revenue from new clients (First year revenue). Any particular geography which is facing the issue? Revenue generation from old client’s v/s new clients? Any particular service industry facing this problem and Competitive landscape.

I: Problem has been there for 6 years now. No specific location assumes any one region and team working there. The revenue generation is 99% from existing clients and 1% from new logos. Problem with every vertical (Industry served by the IT company). Company is growing with the market, but new client revenue is sub-par comparing with the major Competitors.

C: My overall approach would be look at the client acquisition team as a separate entity from the company and look at the structure and hierarchy of the team and the human resources (Ability and Willingness), approach followed by the team while dealing with the prospective clients, and lastly the integration between the both the teams.

I: Sounds fair. Client acquisition employees are generally called hunters. So, the team has Junior hunters, Senior hunters, and Team leader. The team leader reports to the vertical heads.

C: Talking about the division of work, I assume that the junior hunter generally research on the prospective clients, prepares pitches and the senior hunter leads the client interactions? Further, talking about the Ability in terms of qualification, job fit and attrition and also in terms of number of hunters & Willingness in terms of monetary and non-monetary factors. Do you want me to dive deep into either of the factors?

I: Junior hunters are involved in client interactions too. No problem with Ability. We can discuss about the willingness aspect later in the case.

C: Sure, Should I look at the approach followed by the team?

I: Can you elaborate?

C: I will try to analyze the buckets such as Lead generation and targets, vertical expertise of the hunters, resources allocation and sharing with the main team (Integration).

I: There is no set procedure for lead generation. The hunters get leads from farmers (Who have contacts and leads). The farmers are not formal employees of the company but are friends with the hunters. No problem with resource sharing, but the integration is a problem.

C: I could identify few problems here. 1) Lack of formal structure in place which leads to haphazard targeting. 2) Single channel of lead generation and that too informal, 3) Integration problem could be that the client acquisition team is neglected by the vertical heads as they might concentrate on the existing clientele since the revenue share is pretty high.

I: Right, these are few of the problems. However, I want to you to find the reason why the same is happening.

C: Okay, sure. (Confused, as the interview was going well and now the interviewer wanted me to change the course of thinking).

I: Think on a considerably basic level, one aspect which has led to the problems mentioned above.

C: Any particular aspect?

I: Revenue formula.

C: So the Revenue would number of clients multiplied by the average revenue. Has there been a dip in the number of clients through these years?

I: There has been an increase, in fact.

C: Bringing in the quality aspect here. New logos have been increasing but total revenue is not picking up which might be due to the ticket size from new clients.

I: Right, link it to the salary aspects of the hunters.

C: The salary of the hunters would be comprising of fixed, variable and bonus component. Starting with variable and bonus component. Looking at the trend and revenue generation from the new clients, I assume that the bonus component is linked with the number of clients rather than the size?

I: Great, can you give few recommendations?

C: Streamlining the process, information sharing from the teams working with the existing clients to know the industry trends which might help in targeting new clients, Salary structure, where bonus and also the variable component is linked to the size, progressive variable pay policy. (Tried explaining which would be applicable in the short term and long term but interrupted as the interview was already over 45 minutes)

Growth Strategy for a net manufacturer.

The case was more in terms of idea generation and also the approach followed during a guesstimate.
[Please note that I stands for Interviewer and C stands for Candidate]

C: Asked the Preliminary questions. The relevant facts were that the major product line was the fishing nets, and the case was about fishing nets.

I would approach the problem by looking at the equation, Revenue= Quantity sold X Average Price, I would first look at the Pricing Strategy in terms of demand elasticity of the agricultural nets.

I: Explain more on Elasticity.

C: If the demand for our product is inelastic, an increase in price would increase our revenue and if the demand is elastic, a decrease would increase our overall revenue.

I: Fair enough. Go ahead.

C: In terms of quantity sold, I would evaluate the options in terms of a 2x2 matrix, keeping product offering on one axis and market on another axis (Ansoff matrix). Further, I would analyze the value chain from production to distribution to check for any bottlenecks.

I: Why Value chain? Cost is never a problem; we just have to look at the top line.

C: Analyzing the value chain to see if there are ways to enhance production capacity to meet demands which are not satisfied currently.

I: Right, no problem with fulfilment of demand. And now we are talking about demand, can you estimate the market size for fishing nets in India.

C: Sure, I would first try to lay out the approach and look for reduction factors and come up with a number.

I: Okay.

C: Since our target audience are fishermen, from the 130 million population, I would eliminate half of the population looking at the geography of the country (southern half) assuming symmetry. Out of the remaining area, assuming 25% being the coastal region where fishing is done. I would add 20% of the fishing in coastal region to arrive at inland fishing.

I: You can ignore inland fishing.

C: Of the population, I would split it in terms of occupation. (Agriculture, Manufacturing, and Services). Around 60% of the population is involved in agriculture and similar activities. Out of which I am again assuming around 60% to be involved in Fishing and related activities. Now I would divide the population in terms of number of people per household and arrive at the households involved in fishing. Calculating this...

I: That is fine. We are short on time, summarize the case.

C: Summarized.

Client is Pipe manufacturer. We need to reduce the cost by 150 crores. A. Growth Objects: Historically, the company had 8 - 10% growth. New target is 5%.
[Please note that I stands for Interviewer and C stands for Candidate]

C: Before asking question would want to know which type of pipes and the base which we are looking at.

I: Good Question. We produce pipes to transport oil and gas to consumers and hence the costs are extremely high, around 6000 cr.

C: Asked the preliminary questions. No important facts as such.

I: What are the heads under which you would categorize the costs.

C: Material, labor, machine, production methods. Any particular category to focus upon.

I: Let us talk about material. Our raw material constitutes around 60% of the cost. Steel which we bend and make the rolls for our pipe is 95% of our raw material.

C: I will start looking at the procurement process currently and try to find potential optimization methods.

I: We procure for the entire year in one shipment currently.

C: Do we have possibility to alter this, as we might be saving on inventory costs.

I: Inventory is not a problem. But we can break the total order in multiple orders. Efficiency and utilization are an issue. But if we have the liberty to order as many times as possible, we like, what should be the number according to you. Like 1,2,3, 4 or maybe even more?

C: I would go with 2 as we can assess efficiency from the first order and order according and saving on transportation.

I: Great. Should I order 80% in the first or 20% in the first?

C: Should be 80% as would have safety margins and reduce stock out costs as it might disrupt the entire process.

I: Sure. Doing this we can reduce the steel cost by 2%. Can you come up the number?

C: Sure. 60% of 6000 would be the cost of raw material, which is 3600 and 2% of which is 72cr. (Instantly realizing that I missed the 95% part). Sorry, did not factor the 95%, factoring in would come to be around...

I: That is completely fine. Number is secondary.

Q1. Tell me about yourself.
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Q2. Tell me something that is not on your CV.
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Q3. How has the virtual MBA experience been thus far?
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Client is a ropes and nets manufacturer. Their growth has slowed down while their margins are improving. They want to achieve full potential. Help them.
[Please note that I stands for Interviewer and C stands for Candidate]

C: What is the current growth level?

I: Single digit.

C: What is the KRA for achieving full potential?

I: Sales acceleration- double business in 5 years.

C: Who are primary clients and what is our product mix?

I: Primary industries are fishing, construction and agriculture. Let us restrict our analysis to nets.

C: Is it correct to assume our products include safety nets, fishing nets and shade nets predominantly across the three industries?

I: Yes

C: Is it safe to assume that we operate across the value chain and the distribution network is dealership module with region wise traders in place?

I: Yes, distribution module is the most critical and works in the dealership mechanism.

C: How much market share is captured by us and how is the competitive landscape?

I: We are a dominant player.

C: Shall I analyze all the 3 industries and layout their sales acceleration strategy or focus on any particular industry?

I: Let us start with fishing industry.

C: How many types of fishing net do we have? What is the quality, material, and life of these nets?

I: Nylon and rayon nets. Average life 7 years

C: I would like to analyze the product mix, pricing, and distribution aspects across the existing and new potential markets.

I: That is good. Asked follow up questions on what in each bucket would you analyze. Asked to guesstimate the size of the fisherman market.

C: Discussed broad approach. Extrapolated Bengal population to average out the population of coastal states. Divided population by income levels and assumed proportion of population in the segment involved in fishing industry. Estimated overall market demand considering initial and replacement demand based on average years mentioned. Considered market growth @ 5% lower than GDP owing to nature of product. Selling Price of net given by interviewer.

I: Summarize the case and give key next steps to achieve full potential.

C: Checked for any time or spending limit. Suggested recommendations across product, contract-strategy, and distribution network. Product diversification into relatively lower grade and life of net. Increase variants other than rayon and nylon and other use cases for the product. Recommended long-term contracts with fisherman and rental option. Streamline Distribution network across operations. With dealership restricted to one player across prominent regions. Reduce overheads and increases sales.

Your client is an OTA aggregator. It is growing really well at 20-30% over the last 5-6 years. It wants to be IPO ready in 5 years but has negative EBITDA. Chart out the strategy.
[Please note that I stands for Interviewer and C stands for Candidate]

C: Since when is the client operating?

I: 10 years.

C: What is its current market share and how many competitors exist?

I: 30% share and it is the 3rd largest player among the few competitors.

C: What are key services. Are we like MMT with flights and hotels as are key product offerings? Do we offer any other product?

I: Yes, while flights and hotels capture 80% and 15% of revenue mix. We also offer train/bus booking and experiences with experiences captures less than 1%.

C: Are we facing negative EBITDA across all segments?

I: Yes.

C: Primary revenue sources would be commissions. Is my understanding correct?

I: Yes.

C: Is it safe to assume we are primarily catering to the upper middle class and the rich?

I: Yes.

C: Since a path to EBITDA positive is key consideration. I would like to divide my analysis into understanding revenue growth opportunities and secondly look at areas of cost minimization. Is that ok and would you like me to focus on any of the above analysis?

I: Yes, let us focus on revenue.

C: As our revenue model is commission based, I would like to confirm if it is safe to assume that the commission is based on both value and volume of transactions?

I: No, it is based only on value.

C: Since this is a B2B2C operations, I would like to analyze revenue growth opportunities through 2 key stakeholders the customers and the retailers.

I: Let us start with retailers.

C: Shall I focus on flight and hotel segment as they comprise 95% of our revenue?

I: Yes, can you give me suggestions on revenue improvement for these two segments.

C: Laid out my analysis across 3 segments: existing revenue model and scope, and contract strategy, promotions. Suggested enhancing existing revenue model by transition to commission model based on value and volume to benefit from both open and click rates. Suggested push marketing for low ticket purchases increase experience segment contribution. Revamp contract strategy to ensure increase product placement and bundled offers for improving commission paid by retailers.

Focus on revenue from advertisements on desktop, mobile website, and mobile application. Enter new segment and deprioritize segments with low revenue potential. Discussed on bus and train segment. Increase experience offerings to include products offered by likes of Thrillophilia.

I: We are planning on entering car rental. Should we do that?

C: Broke down the cab rental space talked about existing players like Zoomcar predominantly which has captured the market. Discussed about time and resource constraint given negative EBITDA of existing operations.

I: Agreed and asked if we should acquire something like Zoomcar?

C: Suggested no and substantiated based on disadvantages despite the benefits of the strategy keeping in mind the objective of IPO in 5 years.

I: Agreed with recommendation. Please summarize the case.

Q1. NA
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Client is a hospitality chain with properties in Chennai and Kolkata. The chain has been operational for the past 40 years. Due to Covid-19, the chain has witnessed a drop in number of hotel bookings leading to a capacity utilization of 50- 55% which is below the normal level of 60-70% that the chain expects. Keeping in mind the effect of the pandemic, help them in formulating a strategy to improve their capacity utilization.
[Please note that I stands for Interviewer and C stands for Candidate] 

C: Does the client have any operational or budgetary constraints? Do we have any specific timeline or metrics in place to evaluate any strategic option?

I: The client does not have any operational and budget constraints. However, the client would like to see improvement in utilization to the normal levels of around 60-70%.

C: Okay. Can you tell me a bit about the hotels that the client operates, how many hotels the client has in each city, what kind of services are offered?

I: Sure, the client has 2-3 hotels in Chennai and 2 in Kolkata. All the client properties are 5-star hotels under the same brand. The hotels offer a full range of services that would be expected in a normal premium hotel.

C: Can you tell me about the kind of customers who visit the hotel?

I: 70% of the customers for the hotel are business travelers, rest of 30% are primarily foreign tourists.

C: I am assuming that the decrease in the number of customers would be across the two major customer segments. Business travel might have decreased due to increased prevalence of virtual ways of working. Tourism sector has taken a hit which might have resulted in a reduction in the number of visitors coming to the hotel.

I: That is correct. The decline has been across both the customer segments.

C: The utilization of rooms in a hotel is dependent on price. In order to increase utilization, we can look at decreasing the prices. However, such an option can led to dilution of premium image of the hotel. Also, the price elasticity might be very low considering the kind of customers that the hotel caters to.

I: Yes, lowering the prices is not an option.

C: Is the hotel following dynamic pricing?

I: Okay, this can be one option that can be looked at. What else can the client do?

I would like to look at the issue of increasing utilization from two perspectives, one would be to look at ways to increase the hotel bookings by the current Target Group and the second would be to look at ways to attract different set of consumers to the hotel.

I: Let us look at different customer segments that can be attracted by the hotel.

C: We can divide customers into two groups primarily: Business Customers and Non-Business Customers.

I: Let us look at the business customers.

C: For the business customers we can further divide these according to the needs that the hotel can serve. Historically, majority of the business customers would be those staying at the hotel for 2-3 days while being on a corporate visit. Apart from this, the hotel can be used to organize corporate events or industry conferences, conventions etc.

I: Okay, let us look at the non-business customer segment.

C: The non-business customers can be divided into three major buckets: First, tourists or travelers which will include both domestic and foreign. Second, people who come for weddings, art exhibitions or other cultural events and third, people who come to the hotel for dining or entertainment purposes.

I: Okay, now that we have identified different kinds of customers: can you tell me which of these customer segments should be targeted?

C: The number of business customers will remain low as a lot of companies are starting to adapt to a virtual workplace setup. The hotel premises can be optimized for hosting weddings and other cultural events, but this segment will not really grow significantly in size in the future. I would focus on tourist segment of customers which would be expected to increase once the effects of Covid-19 subside.

I: Fine. How would you go about ensuring that this new segment of customers goes for our client’s hotels?

C: We can break down the issue into 4 aspects: Customer Need, Promotion, Accessibility and Service Experience.

I: Can you elaborate on these?

C: Sure, starting with the customer's need. Over the world, tourists seem to be attracted by the value proposition of hotels that give them a flavor of the local culture and lifestyles.

Kolkata and Chennai are two cities that are rich in their heritage and the hotels that our clients have can be shaped to reflect the cultural heritage of these cities. On top of this, tourists prefer authentic experiences and hotels which are technologically advanced.

We can have a different sub-brand for properties offering this new value proposition.

I: This seems fair. What about the other aspects?

C: Under promotion, we need to ensure that our advertising is consistent with the new proposition in terms of the message and the media on which we promote the client’s hotel brands.

Digital presence can be optimized using SEO and digital analytics can be used to target high propensity customers. Under accessibility, we need to ensure that our hotel is listed on all the major OTAs such as Expedia along with optimizing our own website.

The service experience needs to reflect the new value proposition and changes would be required in terms of tangibles, employees, and the ambience.

Our client is a 2-wheeler manufacturer based out of India for the past 35 years. In the past 3 years, it has witnessed a drop in market share from 20% to 15% and drop in EBITDA from 18% to 13%. Help the client.
[Please note that I stands for Interviewer and C stands for Candidate] 

C: Can you tell me about the scale of operations of the client in terms of geography and the distribution channels of the client? What is the current capacity under which it is operating?

I: The client is a Pan-India player operating at 85% capacity. It has a 3rd party distribution and dealer network.

C: Can you talk about the kind of vehicles that the client manufactures? How many different SKUs does the client have?

I: The client manufactures motorcycles in the mid-price segment and has 5 different SKUs.

C: I am assuming the client would be catering to the middle–income segment.

I: Yes, that is a fair assumption.

C: Can you tell me about the competition faced by our client? Are they facing a similar issue in terms of the drop in EBITDA?

I: There are 4 major competitors including 2 emerging players who have taken the bulk of the market share that we have lost. The competitors have not seen a drop in their EBITDA margins.

C: I would like to focus upon the market share issue first. Is the market share in terms of volume or value?

I: It is in terms of value.

C: The market share decline in this can be due to two factors: First, the market share of the higher-priced segments in which our client does not operate has increased at the expense of mid-price segment. Second, our own share within the mid-price segment has decreased.

I: It is a case of both. Let me give you some data:

Segment: Premium
Share: 10
Price Range: >95000
Growth Rate: 30%

Segment: High
Share: 20
Price Range: 65000: 95000
Growth Rate: 25%

Segment: Mid
Share: 35
Price Range: 40000: 65000
Growth Rate:12%

Segment: Low
Share: 35
Price Range: <40000
Growth Rate:15%

C: The mid-price segment has grown at a below average rate of 12% which is one of the reasons for the falling market share of our client.

I: Can we do something about this?

C: Probably enter a new segment.

I: Let us say the client is confused between low and high segment, which one should he choose?

C: It will depend on 4 factors: Size and growth of the segments, profit margin in each segment, level of competition within each segment, client’s expected segment share in each segment.

I: Looking at the numbers that I provided, where do you see greater potential?

C: The high-priced segment is more attractive due to its superior growth rate. Keeping the macro-economic trends in mind, this segment will remain highly lucrative for the future. Also, it might be possible for us to upsell the existing customer base.

I: Seems right, the client has also faced declining share within the mid-priced segment. Can we explore what could be the possibilities in this case?

C: Sure, it can be a function of prices and volume of motorcycles sold. Do you want me to look at any one issue in particular?

I: Let us focus on quantity.

C: The quantity can be constrained at either the supply side, at the dealer stage or at the customer end. I am assuming that since we are running at below capacity at 85%, supply side is not an issue.

I: Yes, leave the supply side. Let us look at the dealers first. What could be the possible issues?

C: There could be two levels of issues: The first could be that the number of customers visiting the dealers themselves has decreased due to some factors such as alternate D2C channels or other dealers in the area. The second could be that the dealer is not pushing our product due to a lack of monetary or non-monetary incentives.

I: What can be done about incentives assuming we cannot increase prices or reduce the client margins?

C: Increase the margins for our dealers. We can use our excess capacity to reduce fixed cost per unit leading to a lower overall cost which can result in higher margins for the dealers assuming we do not pass the benefit to the consumers. The other option could be to offer attractive credit support to the dealers.

I: Okay, let us move on to the issue of customer demand. What could be the possible issues here?

C: We can look at 4 things here: Customer Need, Promotion, Purchase and Post-Purchase. For the first issue, Customer Need, do we have some data on how the client products fare against our competitors in terms of Performance, Features and Durability?

I: The product is competitive in these aspects. Do you think the client can introduce a greater number of SKUs?

C: It depends on how heterogeneous the customer segment is. If it is not heterogeneous, an increase in the number of SKUs will lead to an increase in operational costs with no substantial increase in revenues resulting in lower profits.

I: Seems fair. Let us look at the other issues.

C: Yes, assuming that the product is suited to the customer needs, we can look at Promotion which includes both Push-based and Pull-based promotion. Pull-based promotion will consist of advertising and use of digital marketing to ensure that the client product is within the Initial Consideration Set for the customer. The Purchase experience needs to be seamless and the availability of affordable payment options such as EMIs is extremely important. The Post-Purchase aspect consists of servicing/maintenance, warranties and response to customer feedback.

Devise a Go-To-Market Strategy for a smart watch manufacturer.
[Please note that I stands for Interviewer and C stands for Candidate] 

C: What is the objective behind this move? Does Titan have any budgetary or operational constraints?

I: The share of conventional watches is stagnating, and the client expects huge potential for the smartwatch as an upcoming segment. The objective is to increase market share. There are no budgetary or operational constraints.

C: What is the price range in which its Titan is planning to launch the product.

I: There are two segments that we are looking at: Rs 5K-10K and Rs 10K-20K.

C: Who are the current major players in the smart watch market? What are their current shares?

I: The major players are Apple, Xiaomi and Samsung. The smart watch segment is still in the growth phase.

C: Sure, we can look at any GTM strategy in terms of 4 aspects: Customer TG, Product, Promotions and Distribution/Retail Channels.

I: Let us look at customers. How do we define them?

C: We can define the customers by looking at the needs that a smartwatch can cater to. These needs can be divided into two broad aspects: Functional and Psychological.

I: What will come under each of those broad aspects?

C: Functional needs would include Fitness tracking and Health monitoring, Environment Sensing, Sync capabilities with other devices and Smart Home applications. Psychological needs would include aspects such as Social Status, desire to be seen as cool for having a high-tech product of a brand such as Apple.

I: How do we go forward from here?

C: We need to decide which one of these different needs is going to lead to a significant customer segment. Do we have any data on this?

I: No.

C: I feel that among the functional needs, fitness is going to be a major driver. We can target this segment.

I: How do we define and target such a segment?

C: The customer segment can be largely described in terms of demographics and geography as most technologically oriented fitness-conscious people would be of a younger age group. Use of online channels for promotion and use of e-commerce platforms as well as D2C channels for distribution would be critical to reaching this customer segment. One way to increase the penetration would be to have tie-ups with certain fitness-based apps such as CultFit.

I: How can we ensure that our client gets a decent market share in this segment?

C: One major aspect in this segment would be the ecosystem effect: the greater the number of smart devices that can be connected to the watch, the greater would be its utility. The second major aspect would be the brand image, and this is where competitors such as Apple have an edge over our client due to their technological prowess.

I: But our client also has some complementary assets such as its retail stores like Croma and appliance brands like Voltas.

C: Yes, and it can also leverage some expertise in software from TCS. In addition, the Titan might be the only Indian brand in the segment giving it a unique advantage over others in this regard.

I: How should our client compete against its competitors, on what basis: Brand or Product?

C: The brand of competitors like Apple, Xiaomi and Samsung is too strong to be countered by Titan which is new in this segment. In such a situation, it is always better to compete for product superiority.

I: Interesting. If I were to estimate the size of the smart watches market, how would I do?

C: I would like to use a top-down approach. We can start with India’s population. (I proceeded to use factors in the order: Rural/Urban -> Economic Classification -> Age profile -> Propensity to purchase smart watch. I also mentioned the replacement period).

I: What are the factors that can affect the replacement period?

C: Economic prosperity leading to an upgrade in model, Technological Obsolescence, Desire to own new features and aspiration to own a smart watch from a well-known brand.

Q1. Give me a quick introduction about yourself.
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Client is an Indonesian food delivery startup, like Swiggy and Zomato. It is a market leader in South Asia. Now it wants to enter India. Chart out a Market Entry strategy.
[Please note that I stands for Interviewer and C stands for Candidate]

C: Before starting with the analysis, I have some clarifying questions that I would like to ask.

I: Sure, go ahead.

C: I see that the client wants to enter India, is there specific purpose for this move?

I: Yes, the purpose is growth.

C: Okay. Fair enough. And how can we help our client here?

I: The client would like to know if we will be able to make unit economic profit in India.

C: Sure. I would love to help him with the best of my abilities. (Understood about the company, its USP and specifics about the revenue model, consumer, and competitors. Applied PESTLE to understand market attractiveness. I was asked to focus on unit economic profit and profit is function of revenue and cost. Therefore, I decided to deal with revenue and cost separately).

C: We can do a market estimate to determine potential unit revenue. (The major revenue streams considered were delivery charges and commissions from restaurants. After a detailed discussion, the interviewer asked me to consider 20% of bill value as commission and 25 Rupees as delivery fee. We also talked a little bit about the recent hike in delivery fee by Swiggy and Zomato. I finished the market estimation and the Interviewer nodded in approval after hearing the final number. Then we moved to cost analysis).

I: What type of costs would you consider while doing cost analysis?

C: For unit cost, I would like to focus on labor cost and fuel cost.

I: You can ignore fuel cost for now. How would you go about the labor cost?

C: We have calculated total demand in the guesstimate. From there, we can compute the total number of delivery persons by dividing demand by total number of orders per driver per day. Total number of orders per driver in a day can be found by incorporating peak and non-peak hours.

I: You can continue with this approach.
(I calculated the total number of delivery persons which came out to be a reasonable number.)

C: Do we have any information about the salary given to delivery persons?
(The Interviewer gave me an average salary paid to a delivery person. After doing necessary calculations, I found that the company will incur losses if it enters Indian market.)

Let us begin our case. Client has a diagnostic lab, one of the largest in the world. He wishes to get a good assessment of market in India.
[Please note that I stands for Interviewer and C stands for Candidate]

C: The client wants to enter the Indian market, I presume.

I: That is correct.

C: Before we start, I would like to ask some clarifying questions.

I: Sure, go ahead.

C: What kind of operations does the lab undertake? Does it specialize in certain areas or is it a general-purpose health lab?

I: It is a general-purpose health laboratory. It conducts 2 types of tests – Prevention tests and tests prescribed by doctors.

C: Okay. And what is the nature of technology used in these labs?

I: It is a high-end laboratory; they use the latest technology.

C: To assess the market, we can look into the potential revenue generated from these tests. I would like to analyze Prevention tests and Prescribed tests separately.

I: We can focus on the prescribed tests for the time being.

C: Sure. Since we are talking about one of the largest companies, do we have any data available on the proportion of revenue generated by prescribed tests.

I: Yes, the past data shows that prescribed tests form 80% of the revenues for the company.

C: That is great. That means analyzing the potential revenue from prescribed tests may give us a good idea about the Indian market!

I: That is correct!

C: For prescribed tests, we can analyze the market India possesses by dividing it into urban and rural areas. Rural areas have a huge scope, mainly because of two reasons. First, high percentage of population residing in rural areas. Second, rural healthcare has seen huge investments coming in in the past few years. However, there are some issues about operating a high-end laboratory chain in rural areas.

I: And what are these issues?

C: To start with, currently, there are very a smaller number of functional hospitals in rural areas. That means the number of doctors prescribing the tests would be much less than in urban areas. In addition to this, the sourcing of laboratory equipment and medical supplies would need a well-developed road connectivity. These facilities may be available in rural areas in future, say, in the next 10-15 years? However, if we are assessing the current Indian market, we can ignore rural areas.

I: Good analysis. Let us focus on urban areas.

C: Great! When we are talking about prescribed tests, we mean the tests prescribed to patients by doctors in case the former needs the test to be performed, is that correct? I mean, here we are considering all doctors, working at hospitals or clinics.

I: Yes. You have got it right!

C: Okay. We can do a guesstimate to find the number of doctors in urban areas.

I: No need to delve into that. You can assume that the number of doctors is 0.7 per people pan India.

C: Thank you! That will make the calculation much easier. We know that the current population of India is around 1.3 billion people. Using the data, you just provided, it seems like there are around 9.1 lakh doctors all over India. As number of doctors in urban areas are much more than in rural areas, we can safely say that around 60% of the doctors are working in cities.

I: That is a reasonable assumption. And how many of them would be eligible to prescribe laboratory tests?

C: I believe a huge percentage of urban doctors in India would be eligible to prescribe laboratory tests. Let us say, around 60% doctors fulfil this criterion. The final number comes out to be around 3.3 lakh doctors.

I: Good work. The number seems to be fair. How would you calculate revenue from this number? (This was followed by a discussion on average number of patients attended by a doctor in a day, the number of tests prescribed per day and an average cost of these tests in India. Both Interviewer and I were picking instances from day-to-day life to back our values. We came to an agreement that on an average a doctor prescribes 8 tests in a day with an average cost of 100 Rupees per test.)

C: From this data, the revenue derived from prescribed tests per day is around 24 crores. Say, the laboratory is open 300 days a year, the net revenue per year comes out to be 7200 crores. I presume that the client would require the potential revenue in USD.

I: That is correct. You can do the necessary conversion.

C: Taking the current conversion rate as 1 USD = 72 Rupees, the potential revenue derived from prescribed tests is around 1 Billion dollars. Do we have any data on the present revenue generated by the laboratory chain?

I: Sure, it generates around 7 Billion dollars a year. What do you think, should the client enter the Indian market?

C: India has always been a huge market for healthcare sector. A market with a potential revenue capacity of 1 Billion is an attractive option. It would also result in 14% increase in the global revenue. Moreover, this market is growing at a fast pace of 20% in India. I believe the client should consider this option. (Always back your opinion with number and current scenarios.)

I: Very well. A comprehensive analysis overall. We can close the case now. Thank you.

Let us take a small case. Client is the CEO of PVR Cinemas. Help him in understanding the unit revenue of PVR Setup.
[Please note that I stands for Interviewer and C stands for Candidate]

C: The revenue stream would include revenue from tickets, food and beverages, and advertisements shown before the movie or during the interval.

I: That seems right.

C: The size of a PVR Setup may vary with the size of the city/town it is being introduced in. Are we talking about a PVR Setup in a metropolitan area?

I: That is correct.

C: Okay. A general PVR Setup in a metropolitan area has 4 screens. Each screen has a capacity of 150 people. The price varies from place to place but we can take an average of around 100 Rupees. Do these assumptions seem valid?

I: The numbers seem fair. You can move forward with these values.

C: Thank you. The next step would be to calculate revenue generated from screenings.

I: And how would you go about that?

C: We can use the simple relation that revenue generated per show will be equal to (average number of screens) *(Percentage occupancy) *(average price of each ticket). (It was followed by a detailed discussion on how we would calculate percentage occupancy as it will depend on various factors like - day of the week, any new release, holidays, festivals etc.)

I: You can take an average percentage occupancy of 60%.

C: That is great! So, the number comes out to be around 150*0.6*100*4 = 36000 Rupees per show. We can multiply it by number of shows in a day. (We discussed the various factors to incorporate while calculating the number of shows. I was coming up with values based on my experience. For example, the length of English movies is around 1.5-2 hours whereas Hindi movies are generally of 2.5-3 hours. Further, around 20-30 minutes are allotted between the shows to clean the theatre and allow people to settle in for the next show.)

C: We can take the average length of movie as 2.5 hours. As per my experience, PVR Cinemas are generally operational for 14 hours in a day. Also, around 20 minutes break is given between shows for cleaning. After taking all this into account, we can say that around 5 shows are run on each screen in a PVR Setup. That means, in total, around 20 movies are shown in a day in a PVR Setup.

I: That seems fairly accurate. No need to calculate the final revenue. We can close the case here.

Q1. Why consulting, why Bain & Co.?
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Q2. Why consulting over finance?
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Your client is a cable manufacturer operating pan India. It is one of the 3 largest players in the country. For the last few years, his/her costs have been higher than industry standards. Can you help him/her figure out why is it so?
[Please note that I stands for Interviewer and C stands for Candidate]

C: Reiterated the problem statement and asked some scoping questions. How high have the costs been against the competitors? What is the value chain of the client? Understanding more about the product of the client. What are the costs to be looked at in a particular segment (process leg, geography etc. or at an aggregate level)? Who are the consumers? Have the competitors operated in a similar manner?

I: Let us look at what the various heads of costs can be.

C: Sure. So as per my understanding, the costs incurred can be broken down into the following heads- Raw material acquisition, Inbound logistics, Production and processing, Outbound logistics, Distribution, Marketing & after sales services, others such as depreciation, financing cost etc. Is there any particular cost head I should look at?

I: Do you mind taking a guess?

C: Since it is a high-volume industry, I believe the cost of raw material and logistics (inbound) must be high.

I: That's right, the cost of raw materials and logistics is a major chunk of the client's total cost. Can you maybe figure out why do we have a higher cost?

C: Sure, there can be few reasons for the same, quantity, quality, and suppliers.

I: The quantity we buy has been in line with our processes. We have also had the same suppliers for the last 10 years or so. Is there anything else you can think of?

C: If the quantity we are buying is not an issue, that rules out possibilities of efficiency related costs. We are essentially incurring higher cost per unit which might be because of difference in the quality, form etc.

I: Yes, that is right. While we are buying aluminum in form of sheets. Our competitors are buying it in the form of blocks.

C: That's interesting, is there anything else you want me to look at in this process?

I: No, this should be fine. (Had some discussion about how this industry works and the manner in which this case was actually solved.)

Client is a steel rod manufacturer who wants to reduce costs by a target amount.
[Please note that I stands for Interviewer and C stands for Candidate]

I: Client is a steel rod manufacturer who wants to reduce costs by a target amount. You need to help the client.

C: I would like to start by listing down the major cost heads for the manufacturer. Starting with the procurement of raw material, logistics, manufacturing, storage, and distribution are the major cost heads. Is there anything I am missing here?

I: Safety costs are also a major part of the overall cost. We also import 100% of our raw materials which again is a major cost head.

C: Understood. We can domestically source the raw material required to reduce the cost. Moving on I would like to understand more about the manufacturing process. Is the manufacturing output uniform across or is it cyclic as per the demand?

I: Our client has a uniform output across the year, but the demand is not uniform. This leads to higher holding costs during low demand period. The factory generally operates at 60% of max output.

C: As I understand, the fixed cost and the holding cost are high and there is a scope to optimize it. Instead of uniform production we could look at cyclic production and lease out our factory area to other players. This would also help us get the transportation costs down and we could operate closer to max capacity, optimizing the operating costs as well.

I: Correct, we could plan to move the production process to cyclic process rather than uniform and also revisit the procurement costs. Thank you, that would be it.

One is about the profit improvement and the other one is about market entry

Q1. Behavior and case
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Q2. Working experience
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