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    Guesstimate - Baby Diaper Market Estimation

    Uploaded by

    Mimansa Dubey
    The document outlines a 5-step approach to estimate the market size of disposable baby diapers in India: 1) Scope the problem to diapers used by babies, 2) Adopt a demand-side approach considering key variables like number of baby users and diaper usage/price, 3) Develop a master equation relating these variables, 4) Make assumptions about population, diaper usage, and income distributions, 5) Plug assumptions into the master equation to calculate the number of baby users and ultimately the market size at Rs. 66,795 crores.

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    Guesstimate - Baby Diaper Market Estimation

    Uploaded by

    Mimansa Dubey
    180 views12 pages
    The document outlines a 5-step approach to estimate the market size of disposable baby diapers in India: 1) Scope the problem to diapers used by babies, 2) Adopt a demand-side approach considering key variables like number of baby users and diaper usage/price, 3) Develop a master equation relating these variables, 4) Make assumptions about population, diaper usage, and income distributions, 5) Plug assumptions into the master equation to calculate the number of baby users and ultimately the market size at Rs. 66,795 crores.

    Original Description:

    Guesstimates

    Original Title

    Guesstimate_ Baby Diaper Market Estimation

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    The document outlines a 5-step approach to estimate the market size of disposable baby diapers in India: 1) Scope the problem to diapers used by babies, 2) Adopt a demand-side approach considering key variables like number of baby users and diaper usage/price, 3) Develop a master equation relating these variables, 4) Make assumptions about population, diaper usage, and income distributions, 5) Plug assumptions into the master equation to calculate the number of baby users and ultimately the market size at Rs. 66,795 crores.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    180 views12 pages

    Guesstimate - Baby Diaper Market Estimation

    Uploaded by

    Mimansa Dubey
    The document outlines a 5-step approach to estimate the market size of disposable baby diapers in India: 1) Scope the problem to diapers used by babies, 2) Adopt a demand-side approach considering key variables like number of baby users and diaper usage/price, 3) Develop a master equation relating these variables, 4) Make assumptions about population, diaper usage, and income distributions, 5) Plug assumptions into the master equation to calculate the number of baby users and ultimately the market size at Rs. 66,795 crores.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 12

    Guesstimates for

    Consulting Interviews
    Baby Diaper Market
    Estimation
    Interviewer: Estimate the
    market size of disposable
    baby diapers in India.

    Share your approach and


    solution in the comments
    down below.
    Let's break down the problem into
    a 5-step structured approach.

    Step 1: Scope

    Based on the problem statement,


    we will restrict the scope of the
    case to the diapers that are used
    by babies.
    Step 2: Approach and Variables

    We'll adopt a demand-side


    approach to solve the case.

    Key variables would include:

    -> Number of Kids using diapers in


    India
    -> Number of Diapers used in a day
    -> Price of each diaper
    Step 3: Master Equation

    In this step, we'll be building a


    master equation which can guide
    us to our final answer. The equation
    can be written as follows:

    Market Size of Disposable


    Diapers =
    Number of babies using diapers *
    Number of diapers used in a day *
    365 * Price of one diaper
    Step 4: Assumptions

    Population of India = 140 cr


    Life Expectancy = 70 years
    Number of diapers used/day = 5
    Price of each diaper = Rs 10

    Kids between the ages of 0-3 use


    diapers and uniform distribution
    of population across age ranges.
    Kids belong to families of 3
    different income levels:

    High Income = 10% (Total Kids)


    Medium Income 30%
    Low Income = 60%

    Preferences and affordability of


    kids' families to use diapers:

    High Income = 100%


    Medium Income = 70%
    Low Income = 50%
    Framework Snapshot
    Step 5: Final Calculations

    Number of babies using diapers =


    Sum (Kids between ages 0-3 yrs *
    Percentage as per Income
    distribution * Percentage as per
    preferences and affordability)

    Population in age group 0-3 yrs


    = (Population of India/Life
    Expectancy) * Age range
    = (140 cr/70 yrs) * 3
    = 6 crores
    Dividing this into the different
    income groups:

    High Income = 6cr*10% = 0.6cr


    Medium Income = 6cr*30% = 1.8cr
    Low Income = 6cr*60% = 3.6cr

    Multiplying this by percentage as per


    preferences and affordability:

    High Income = 0.6cr*100% = 0.6cr


    Medium Income = 1.8cr*70%=1.26cr
    Low Income = 3.6cr*50% = 1.8cr
    Therefore, the number of babies using
    diapers
    = 0.6cr + 1.26cr + 1.8cr
    = 3.66cr

    Now, as per the master equation in


    step 3:

    Market Size of Disposable Diapers =


    Number of babies using diapers *
    Number of diapers used in a day * 365
    * Price of one diaper
    = 3.66cr * 5 * 365 * Rs 10
    = Rs 66,795cr
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