National Taiwan University (NTU) Consulting Club Casebook 2024

National Taiwan University
(NTU) Consulting Club

Casebook 2024
Openings
Acknowledgements
Dear Reader,
We are proud to unveil a groundbreaking milestone in Taiwanese consulting clubs: the inaugural casebook from the National
Taiwan University Consulting Club (NTUCC). Casebooks are a cornerstone of excellence for premier consulting clubs globally,
serving as a benchmark for their expertise. With this publication, we aspire to amplify NTUCC's influence and contribute
meaningfully to the Taiwanese consulting community.
We are deeply indebted to CaseCrackers for their unwavering support. Their invaluable contributions in reviewing cases,
providing business insights, and enhancing the casebook's overall quality were instrumental in this endeavor.
This comprehensive collection encompasses 9 cases across 3 thematic areas, empowering readers to:
1. Gain a comprehensive understanding of case interviews

2. Master the art of problem-solving through structured approaches and logical deconstruction
3. Simulate real-world case interview scenarios and effectively evaluate potential solutions
Once again, we extend our heartfelt gratitude to CaseCrackers for their invaluable contributions. We also express our deepest
appreciation to NTUCC alumni for their dedication over the past 11 years, laying the groundwork for this remarkable
achievement. We hope it serves as a stepping stone for aspiring readers to navigate the uncharted territories of the consulting
world.
With warmest regards,

11th NTUCC Casebook Committee
2
Openings
CaseCrackers provide personalized services to empower aspiring candidates
● Graduated from MIT, Columbia, and NYU Stern MBA programs

● Management Consultants with offers from MBB (McKinsey, BCG, Bain),
Kearney, and more
Professional ● Experience in coaching 100+ candidates with case interviews and CV
Background reviews
Empowering individuals to unlock their full potential by providing

personalized and strategic guidance.
CaseCrackers are committed to offering insightful advice, practical tools,
Mission and industry knowledge to help our clients navigate their career journeys with
Statement confidence and clarity.
Business Case Interview Resume Top MBA

Services Interview Prep Coaching Refinement Application
Consultancy
3
Openings
NTU Consulting Club Casebook Committee
Morris Chen Rack Su Ruby Chen Edwin Wu Leon Shen Sheena Fan
(Project Manager) (Project Manager) (Project Manager) (M&A) (M&A) (M&A)
Hazel Chen Catherine Liu Oscar Ou Jessica Chang Jenny Kao Andrew Pan
(Profitability) (Profitability) (Profitability) (Market Entry) (Market Entry) (Market Entry)
4
Openings
Table of Contents
1 Introduction to NTU Consulting Club (NTUCC)
2 Consulting Industry Overview
3 Case Interview Introduction and Preparation
4 Industry Overview
5 Case Index
6 Cases
5
Openings
Introduction to NTU Consulting Club (NTUCC)
NTU Consulting Club fosters a community that equips diverse students with consultancy skills to become
Vision future leaders. We cultivate potential consultants of the next generation, shape the future consulting industry
with wisdom and passion, and become the best partner for business transformation.
Inspire others, shape the future!
Strategic Thinking Personal Impact Diversity & Global Mindset
Course Project Workshop Career Event
• Teamwork Engagement
• Consulting Methodology
• Communication and • CV and Interview Training • Career Development
• Research and Analytical Presentation Proficiency • Slide Writing Skills • Networking Opportunities
skills • Project Expereince
6
Openings
Consulting Industry Overview
What is Management Consulting? Who are eligible for the consulting industry?
Management consulting's purpose is to help organizations meet A career in management consulting is accessible to candidates from any
strategic goals by addressing complex challenges and fostering academic background, provided they exhibit exceptional problem-solving
growth. Consultants provide objective advice and practical solutions abilities, analytical skills, and teamwork/people skills.
to enhance efficiency and build necessary skills, aiming to guide
Purpose businesses through operational and strategic improvements. This skill is at the core of consulting work. Consultants are
expected to tackle complex business issues and devise
effective strategies to resolve them. This involves identifying
Problem Identification and Analysis: Collaborate with clients
the root causes of problems, generating innovative solutions,
(C-suite) to identify key issues, conduct in-depth research, and
Problem-solving and implementing these solutions to drive positive change
gather/analyze relevant data to develop hypotheses and solutions.
Abilities within client organizations.
Strategy Development and Solution Design: Formulate
recommendations based on insights from analysis, and design Consultants must possess the ability to analyze vast amounts
Consultant’s actionable solutions. of data, interpret patterns, and extract meaningful insights.
Work These skills are critical for making informed decisions and
Implementation: Oversee the execution of proposed solutions,
ensuring alignment with project goals to ensure smooth transitions providing evidence-based recommendations to clients, which
and adoption of new processes or systems. Analytical includes proficiency in quantitative analysis, financial
Skills modeling, and the use of analytical tools.
Industries: Consulting firms serve a wide range of sectors including
finance, healthcare, tech, retail, public sector, etc. The consulting environment is highly collaborative, requiring
consultants to work effectively in teams and build strong
Functions: Their expertise spans across functions such as strategy
relationships with clients and colleagues. Effective
Industries formulation, operations improvement, HR optimization, financial communication, leadership, and the ability to influence others
advisory, risk management, etc by offering strategic insights and Teamwork &
& Functions are key components of this skill set.
People Skills
actionable solutions to enhance performance across critical areas.
7
Openings
Consulting Industry Overview
Why consulting? How to get a consulting offer?
Diverse Exposure: Consulting provides experience across Develop Core Consulting Skills: Strengthen problem-solving,
sectors/functions, offering a broad understanding of different market analytical thinking, communication, and leadership abilities
dynamics and business operations. through coursework, projects, and extracurricular activities.
Exposure & Rapid Skill Acquisition: The fast-paced and project-based nature Reﬁning the Gain Technical Proficiency: Build expertise in tools and
Learning of consulting work accelerates the learning curve, allowing Skillset methodologies used in consulting, such as data analysis, financial
Opportunity consultants to quickly acquire new skills and knowledge. modeling, and project management.
Direct C-Suite Engagement: Consultants often collaborate closely Build Authentic Relationships: Engage in genuine conversations
with top executives, providing strategic advice that influences the with professionals, alumni, and peers in the consulting industry to
direction and priorities of the organization. establish meaningful connections and gain valuable insights.
Tackling Critical Issues and Decisions: Consultants address Leverage Connections for Insights and Opportunities: Utilize
Impactful pressing business challenges and contribute to strategic Networking your network to learn about different consulting firms, their cultures,
Work decision-making, directly impacting organizational success and and potential job openings, while seeking advice and referrals to
future direction. support your job search.
Broad Exit Opportunities: Consulting experience opens doors to Master Case Interviews: Practice extensively with case studies,
leadership roles in various industries, from corporate strategy to focusing on structuring problems, analyzing data, and presenting
entrepreneurship. recommendations to demonstrate your problem-solving skills.
Exit Opportunity Network Advantages: The extensive network built during a Cracking the Prepare for Behavioral and Personal Experience Interviews
& Career consulting career provides a platform for exploring diverse career Interview (PEI): Reflect on your experiences and develop compelling stories
Flexibility paths and opportunities. that showcase your leadership, teamwork, and personal impact.
8
Openings
Case Interview Introduction & Preparation

Case interviews simulate consultants' real-world experiences, where candidates engage with the interviewer to
analyze problems, hypothesize, and offer solutions for client issues.
1
At the beginning of the case, interviewers provide brief background information.
Clarification To ensure alignment between the candidate and the interviewer's understanding, candidates should briefly
of the Question summarize the case background they've heard. They should also inquire about any necessary, relevant
information from the interviewer to make informed judgments in the subsequent problem-solving process.
2
Structural Since the requirements of the question usually involve a broad objective, it's essential to break down a large
Breakdown problem into smaller, manageable components and identify the most critical factors to further progress.
3
Calculation ＆ As the storyline of the case progresses, there will be situations requiring numerical calculations, analysis,
Brainstorming and brainstorming for solutions. This necessitates structured thinking and responses.
4 Towards the end of the case, quickly recap the entire problem-solving logic and provide recommendations
Recommendations for resolving the client's issues.
The overall time for this phase should be approximately 1 minute and 30 seconds.
9
Openings
Case Interview Mindset
Structural Thinking (Be MECE)

Approach the problem in a structured and organized manner, adhering to the MECE (Mutually Exclusive, Collectively Exhaustive) principle.
Break down complex issues into smaller, manageable components, ensuring that your analysis covers all relevant areas without overlap.
This methodical approach helps in presenting your findings logically and makes it easier for the interviewer to follow your reasoning.
Hypothesis Driven
Begin with an initial hypothesis or educated guess about the problem. This approach helps structure your analysis and ensures that your
investigation is focused and directed towards proving or disproving your hypothesis. It allows you to work efficiently by prioritizing
areas that are most likely to yield valuable insights.
Data/Analytical Driven
Base your conclusions and recommendations on solid data and rigorous analysis. This mindset emphasizes the importance of gathering
relevant data, interpreting it accurately, and using it to inform your decision-making process. It ensures that your solutions are backed by
evidence rather than assumptions or intuition.
Be Engaging with the Interviewer

Treat the interview as a collaborative problem-solving session. Actively engage with the interviewer by listening carefully, asking
clarifying questions, and articulating your thought process clearly and confidently. This interaction helps build rapport, ensures alignment,
and demonstrates your communication skills.
10
Industry Overviews
11
Industry Overviews
OTA (Online Travel Agency)

Suppliers Players Customers
● Accommodation Providers
● Airlines
● Car Rental Companies
● B2C customers
● Activity and Tour Operators
● Cruise Lines
● Travel Insurance Companies
Products/Services Financial Factors Key Trends in Industry
● Mobile Optimization
Revenue:
Following the trend of bookings made
● Accommodation Booking Commission Income, Service Fees, Advertising,
via smartphones.
● Flight Booking Membership and Subscription Fees, Ancillary Services
● Sustainability & Personalization
● Car Rentals (travel insurance, car rentals, airport transfers), Foreign
E.g. digital nomadism and
● Travel Packages Exchange Gains
eco-conscious travel.
● Travel Insurance
● Technology & AI Integration
● Cruise, Activities & Excursions Cost:
Provides personalized
● Travel Guides and Information Technology Infrastructure, Marketing and Advertising,
recommendations and improve
Wages, Operational Costs
customer experience.
12
Industry Overviews
Automotive
● Tier-1 Suppliers: Supply major ● B2C Consumers

systems and assemblies (OEMs). ● B2B Businesses
● Tier-2 Suppliers: Supply ● Government Entities
electronics, fasteners, plastic parts. ● Rental Agencies
● Raw Material Suppliers: Supply ● Taxi Services and Ride-sharing
the fundamental materials. Companies
● Electrification
Products Revenue:
Transition towards electric vehicles
● Passenger Vehicles Vehicle Sales, Aftermarket Parts and Services (Sale of
(EVs) to reduce carbon footprint.
● Commercial Vehicles replacement parts, accessories, and post-warranty repair
● Autonomy (Self-driving technologies)
● Motorcycles and Scooters services.), Business Fleet Sales
● Connectivity
● Electric and Hybrid Vehicles
Connected with IoT, allowing for
Services Cost:
real-time data exchange.
● Maintenance and Repair Raw Materials (Fluctuations in these costs can significantly
● Shared Mobility
● Aftermarket Parts and Accessories affect profitability.), Labor Costs, R&D, Manufacturing and
Growth in car-sharing / ride-hailing
● Software Updates Tooling, Marketing and Sales
services instead of vehicle ownership.
13
Industry Overviews
Retail
● Consumer Goods
Manufacturers
● B2C Consumers
● Wholesalers and Distributors
● Importers
● Omnichannel Experience
Revenue:
In-store experience and integration with
● Food, Beverage, and Grocery Product Sales, Services, Membership and Subscription
online services.
● Apparel, Footwear, and Accessories Fees, Franchise Fees
● E-Commerce Growth
● Consumer Electronics
● Private Labels
● Home Goods and Appliances Cost:
Retailers’ own private brands.
● Health and Beauty Products Cost of Goods Sold (largest expense typically), Labor, Rent
● AI and Big data analysis
● Other Consumer Goods and Utilities, Marketing and Advertising, Supply Chain and
To enhance customer experience and
Logistics, Administrative Expenses
provide customize services
14
Industry Overviews
Software
● Infrastructure provider (e.g. ● B2C Consumers

Server) ● B2B Businesses
● IT outsourcing service provider ● Government Entities
● Security service provider ● Organization
Revenue:
● Transitioning to the cloud
Primarily being generated through licensing or subscription
● Usage of AI to boost software
Provide customer with digital product to carry fees, which are typically structured into various plans to
development
tasks, from operation system to application, offer differentiated pricing. Additional revenue streams
● Low-Code/No-Code development
such as: include maintenance fees and storage fees.
● Ecosystem establishment
● ERP Cost:
Built community of stakeholders to
● CRM Research and Development (R&D) constitutes a significant
scale the distribution of digital
● Microsoft office portion of the costs in this industry. Additionally, the marginal
platforms and services, and driving
costs associated with selling software products are
accelerated adoption.
generally minimal.
15
Industry Overviews
FMCG (Fast Moving Consumer Goods)

● Raw Material Suppliers

(Agricultural, Chemical, ● Whole sale retailer (such as
Packaging Material, Food Walmart, Sam’s club, and
Additives and Preservatives) Costco)
● Convenience store
● Manufacturing and Production
● Drug store, Pharmacy
● Logistics and Distribution
Revenue:
Revenue is primarily driven by the large volume of goods
● Environmentally sustainable product
Provide short shelf life product, such as sold. Additionally, products with strong brand recognition
Replace traditional plastic package by
● Process food can command premium pricing.
reusable and eco-friendly materials.
● Beverage
● Growth on E-commerce
● Cleaning product Cost:
Brand make more connection with
● Cosmetic The major costs in this industry include the Cost of Goods
customer through online channel.
Sold (COGS) and marketing expenses. Other significant
costs include packaging, spoilage, and shelf replacement.
16
Industry Overviews
E-commerce
● B2C Consumers
Various manufacturers and retailers
● B2B Businesses
● Live Commerce
Revenue:
Customers can engage with a host in
Sales revenue of products, commission revenue,
Facilitate direct online sales or provide a real-time via live-stream while shopping
transaction revenue, ad revenue, and logistic revenue
platform for transactions between sellers and for products.
buyers for any sellable product or service ● Online-to-offline E-commerce
Cost:
● Developing RMN to Advertise
Cost of Goods Sold (COGS), logistic cost, marketing
Leverage E-commerce’s first hand data
expense, and transaction cost
to provide advertisement business
17
Industry Overviews
Healthcare (Provider)
● Medical Device Providers

● Pharmaceuticals
● Distributors ● Patients/Consumers
● Technology Providers (AI, IoT,
Telehealth)
● Low Expenditure: Taiwan's healthcare

● Medical Services: Comprehensive
expenditure was 6.6% of its GDP in
care including preventive, curative, Revenue:
2023, which is lower than many
rehabilitative, and palliative services NHI1 Reimbursement, Government Funding, Out-of-Pocket
developed countries (e.g. US: 16.6%;
● Pharmaceuticals: Both generic and Payments
JP: 10.9%)
branded drugs, with a significant
● Workforce Issues: Low expenditure
portion being imported Cost:
results in lower salaries for healthcare
● Medical Devices: Includes diagnostic Salaries and Wages, Selling General and Administrative
professionals, leading to workforce
equipment, wearable health tech, and Expenses (SG&A), Facility and Equipment Costs
shortages and high turnover rates due
surgical instruments
to long hours and stress
NHI1: National Health Insurance 全民健康保險 18

Industry Overviews
Aviation (Airline)
● Aircraft Manufacturers (Airbus,

Boeing) ● Leisure Travelers
● Parts Suppliers (Rolls-Royce) ● Business Travelers
● Fuel Suppliers (Shell Aviation)
● Logistics Providers ● Cargo Clients
● MRO (Maintenance, Repair, and ● Government and Military
Overhaul) Providers
● Investment Trends: High capital

Revenue: intensity, long payback periods,
● Passenger Transport: Scheduled
Ticket sales, cargo services, ancillary services (e.g., significant R&D investments
and chartered flights for domestic and
baggage fees, seat selection), loyalty programs ● Sustainability: Adoption of sustainable
international travel aviation fuels (SAFs), electric and
● Cargo Transport: Freight services for hybrid-electric aircraft to reduce carbon
Cost:
goods and products footprint
Fuel prices, labor costs, maintenance costs, regulatory
● In-Flight Services: Meals, Wi-Fi, ● Technology and Automation: Use of
compliance AI, IoT, and big data analytics for
entertainment and other amenities
operational efficiency and customer
experience
19
Industry Overviews
Pharmaceutical
● HCP (Healthcare Professional),

who prescribes drugs and
● R&D, Pre-clinical firms
provide medication
● Drug Manufactuer, CDMO
● Insurance Organizations, who
● Distributer/Wholesaler
pays the bill of medication
● Patients/Consumers
● Duration & Success Rate:

Revenue:
a. Phase I：2 yr, ~60%
Product Sales, Licensing Fees and Royalties, R&D
b. Phase II：3 yr, ~30%
● Prescription Drug Services, Goverment and Academic Grants,
c. Phase III：3 yr, ~30%
1. Brand Name (Originator) Drugs Reimbursement (from insurance company)
● Patent Length: 20 yr from the date of
2. Generic Drugs
filing
● Over-the-Counter (OTC) Drug Cost:
● Outsourcing of R&D and manufacturing
Cost of Goods Sold, R&D, Marketing and Sales, Regulatory
● High demand in personalized medicine,
Compliance, Legal Expenses
telemedicine and AI integration
20
Industry Overviews
Finance
● General public
Deposit from public, corporations, and ● High asset individual
organization ● All size of corporation and
organization
● Introducing New Technology

Revenue:
Leverage AI and hybrid cloud to improve
Provide various financial service like: The primary revenue stream is the spread between deposit
service
● Deposit and loan interest rates. Additional revenue comes from
● Open Banking
● Credit card service fees, which are charged based on a percentage or
Enable third-party providers to access
● Loan the number of services provided.
consumer data through API, providing
● Trust
more choices and improved financial
● Wealth management Cost:
products.
● Fund and security Interest expense, salary, bad debt expense, and
● Enhancing Customer Experience
depreciation.
● Digitizing Financial Service
21
Industry Overviews
Manufacturing
● Raw Material Suppliers ● B2C

● Component Suppliers ● B2B
● Equipment Manufacturers
Varies widely by product and region. Varies by industry and position in
Plants are owned / operated or supply chain, can be consumers or
contract manufactured raw materials to business
● Machinery and Equipment ● Automation & Robotics

Revenue
● Automotive Parts ● Sustainability & Green Manufacturing
Volume of Goods Sold, Price Premium on Branded Goods,
● Electronics and Electrical Components Through eco-friendly process/ products
Maintenance and Repair Services, Licensing and Royalties
● Chemicals and Materials ● Smart Manufacturing & IoT
● Consumer Goods Create smart factories with real-time
Cost
● Other monitoring and data analytics.
Cost of Goods Sold, Raw Materials Commodities, Labor,
● Global Supplychain Management
Transformation of materials / substances / Rent and Utilities, R&D, Supply Chain and Logistics,
Manage risk from geographical tension,
components into new products Administrative Expenses
economical volatility, etc.
22
Industry Overviews
Private Equity / Investment

● Private Investors ● Institutional Investors

● Foundations ● Portfolio Companies
● Large Corporations ● Other
● Emerging Markets
Revenue: With high growth potential.
Management Fees, Performance Fees (Carried Interest), ● ESG
● Levereged Buyouts (LBOs)
Dividends from Portfolio Companies, Capital Gains Sustainable
2 and responsible investing,
● Growth Capital 3
incorporating ESG criteria into
● Venture Capital
Cost: investment decisions.
● Distressed/Turnaround Investments
Investment Expenses, Due Diligence Expenses, Legal and ● Specialized Funds
● Mezzanine Financing
Regulatory Fees, Operating Expenses of Portfolio Emergence of niche funds focusing on
Companies, Interest Expenses (for Leveraged Buyouts) specific sectors, such as healthcare,
technology, or real estate.
23
Introduction
Case Index
Name Industry Level Qual* Quan Chart Page
ABC Co. Retail Medium Medium Easy 25

Profitability
Tech Innovations Inc. Technology Easy Easy Easy 39
AEC Co. E-commerce Easy Easy Easy 51
Tastea Retail Medium Medium Medium 61

Market Entry
Weight-Loss Injection Healthcare Easy Easy Easy 72
Enigma Smartphone Technology Medium Easy Medium 80
Rapid Co. Automotive Medium Easy Medium 92

M&A
Inu group Retail Medium Medium Easy 107
Travel Tycoon OTA Hard Hard Medium 120
*Qual / Quan illustrates the level of ‘Qualitative Questions” and “Quantitative Questions” in that case 24
Profitability Case 1 - ABC Co.
Case 1 – ABC Co.

Case Prompt
Case Type: Profitability
Level: Medium
ABC Company, a leading fragrance retailer with operations in over 10 countries, Industry: Retail
specializes in the sale of perfumes, diffusers, and hand creams. Despite its established Expected Time: 20-25 mins
presence, ABC Company is seeking to enhance its profitability within the Taiwanese
market over the next two years. The company has engaged your consulting team to #Cost-analysis
identify potential growth opportunities and to develop actionable strategies for
achieving this objective.
Additional Information (If asked) Interviewer Guidance
• The average prices for these products is as follows: perfumes at $2,000, diffusers at • The interviewer should provide exhibits
$1,000, and hand creams at $500, respectively. in response to the interviewee’s
• The company employs a B2C business model, utilizing both online and offline questions rather than offering them
channels. Online sales are conducted through the company's website, while offline directly.
sales are managed through one flagship store and three department store counters. • The interviewee should lead the
• ABC Co. aims to maximize its profitability without a specific goal. discussion of the exhibits to arrive at a
conclusion.
26
Case Questions
1 What factors would you consider to work on this problem?
2 Calculate the 2023 revenue of ABC Co. and assess the trend from 2022 to 2023.
3 Identify the bottlenecks in the conversion rates of different channels.
Calculate the 2023 cost and the net profit of ABC Co. for each channel and identify which cost components are
4 critical to ABC Co.'s profitability.
5 What are your recommendations for enhancing profitability for ABC Co.?
6 The CEO has just entered the room and asked you to summarize your current recommendations.
27
Q1 - Structure
Question 1 What factors would you consider to work on this problem?
Revenue Measurement Cost Evaluation External Factors
Online Overall • Market Share

• Quantity: Traffic, Number of member • COGS, Salaries, Costs of logistics, • Market Trends
registrations, Number of products ordered, Marketing • Competitive Landscape
Conversion rate Online • Consumer Preferences
• Price: Single purchase amount • Website maintenance, Packing and shipping
Offline products, Payment processing fee
• Quantity: Purchase quantity, Traffic Offline
• Price: Single purchase amount • Rent, Utilities, Inventory
*Note: This is just one of many potential ways to structure your approach. Please treat this example only as a reference point and develop
your own style.
28
Q2 - Math
Question 2 Calculate the 2023 revenue of ABC Co. and assess the trend from 2022 to 2023.
*Please share the following information with the candidate: Exhibit 1
ABC Co. garnered $3 billion in revenue in 2023. Despite a burgeoning online presence, the flagship's
decline due to faltering hand cream and diffuser sales contrasts with the department store's stability.
Calculations ● Channel Analysis

The online sales channel shows lower sales performance compared to offline
Online Store: channels, yet the overall trend is on the rise. Among the offline channels, the
(200,000*$2,000)+(150,000*$1,000)+(100,000*$500)= $600M flagship store accounts for the most revenue, but both offline channels are
Flagship Store: experiencing a decline. The decline may be due to COVID-19 shaping people's
consumption habits. However, the decision on which channel to emphasize
(300,000*$2,000)+(100,000*$1,000)+(100,000*$500)= $750M
should be confirmed after calculating costs and confirming margins.
Department Store *3:
● Product Analysis
(150,000*$2,000)+(150,000*$1,000)+(100,000*$500)= $500M
Among all products, perfumes have the highest prices and their sales volume is
$500M *3 = $1,500M significantly higher than the other products. Therefore, perfumes might be the
flagship product for ABC Co.
29
Q2 - Exhibit 1
Exhibit 1 Revenue Structure of ABC Co.
Sales Volume in Department Store

Sales Volume in Online Store Sales Volume in Flagship Store
(Per Store)
Perfume Diffuser Hand Cream

600
Unit：thousands (sales volume) 500
450 500
400
300 400
250
200 300
150 150
150
150 150
150 150 100
100 150 100 100

100 100
2022 2023 2022 2023 2022 2023
30
Q2 - Interviewer Guidance
Question 2 Calculate the 2023 revenue of ABC Co. and assess the trend from 2022 to 2023.
Basic Answers (Expected from all the candidates)

• The revenue for each sales channel is as follows: the Online Store generated $600 million, the Flagship Store generated $750
million, and the each Department Store generated $500 million.
To impress the interviewers… (For outstanding performers)

• The online sales channel shows lower sales performance compared to offline channels, yet the overall trend is on the rise. Among
the offline channels, the flagship store accounts for the most revenue but both offline channels are experiencing a decline. The
reason may be due to COVID-19 shaping people's consumption habits. However, the decision on which channel to emphasize
should be confirmed after calculating costs and confirming margins.
• Among all products, perfumes have the highest prices and their sales volume is significantly higher than the other products.
Therefore, perfumes might be the flagship product for ABC Co.
31
Q3 - Analysis
Question 3 Identify the bottlenecks in the conversion rates of different channels.
*Please share the following information with the candidate: Exhibit 2, Exhibit 3
The repurchase rate is an issue that generally needs to be addressed across all channels,
necessitating an improvement in the online store's purchase rate as well.
● Online Store
○ The purchase rate is lower than the other two channels (50% compared with 85% in flagship store and 65% in department store), the
reason may be that customers cannot try the perfume online, reducing their willingness to buy.
○ The repurchase rate is significantly lower than offline channel (10% compared with 45% in flagship store and 42% in department store),
indicating that customer may not be satisfied with their product, and this could be because they cannot try the perfume first, so they may
not like the smell.
● Flagship Store
○ Both the purchase rate and the repurchase rate are higher than those of the other two channels, and performance seems good. It is
possible that the target customer value the customer experience, and flagship stores have more resources to provide a deeper customer
experience.
● Department Store Counter
○ The repurchase rate is roughly the same as flagship store, indicating a roughly 30% gap (40% in offline channel and 10% in online
channel). This suggests that being able to try the perfume before buying may be a key factor in customer satisfaction.
32
Q3 - Exhibit 2
Exhibit 2 Conversion Rate in 2023 for Each Channel
Visit Online Store Flagship Store Deparment Store
Purchase 50% 85% 65%

Rate
Purchase
Repurchase
10% 45% 42%
Rate
Repurchase
33
Q3 - Exhibit 3
Exhibit 3 ABC Co.’s Consumer Review Data
Online Store Flagship Store
The perfume I bought has a The clerk carefully guided me

stronger scent than I expected. I through trying various products,
thought it would be floral, but giving me a sense of being
User 1 the fruity smell is more intense. attentively cared for.
User 3
The clerk used my membership

I always feel that the base note
information to understand my
of the fragrance does not meet
past purchases and
my expectations.
User 2 recommended a new fragrance
User 4 that I would really like!
34
Q4 - Math
Calculate the 2023 cost and the net profit of ABC Co. for each channel and identify
Question 4
which cost components are critical to ABC Co.'s profitability
The online store has the highest net profit at 68%, followed by the flagship store at 45%, and the
department store counter at 56%.
Calculations
Online Store: ● Crucial Cost Components
Cost : (95+15+29+29+22) = 190M The online platform has cost components that are less significant compared to
Net Profit: (600-190)/600 = 68% offline channels, where the major costs are rent and personnel expenses.
Flagship Store:
● Net Profit Measurement
Cost : (165+148+49+25+25) = 412M
Net Profit : (750-412)/750 = 45%
According to the calculation of the net profit, it can be concluded that the online
channel is overall more profitable (68% compared with 45% and 56%).
Department Store Counte *3: Therefore, to improve profits, we should focus on online channels with an
Cost : (105+65+25+13+13)*3 = 663 M upward trend in revenue and the highest net profit.
Net Profit : (1500-663)/1500 = 56%
35
Q4 - Exhibit 4
Exhibit 4 ABC Co.’s Cost Structure in 2023 for each channel
Online store Flagship store Department Store Counter
Components: Components: Components:

(Denominator is total cost of the channel in 2023) (Denominator is total cost of the channel in 2023) (Denominator is total cost of the channel in 2023, per store)
● COGS : 50%, 95M ● COGS : 40%, 165M ● COGS : 47.5%, 105M
● Web maintainence : 7.9%, 15M ● Rent : 35.9%, 148M ● Rent : 29.4%, 65M
● Logistics : 15.3%, 29M ● Salary : 11.9%, 49M ● Salary : 11.3%, 25M
● Salary : 15.3%, 29M ● Logistics: 6.1%, 25M ● Logistics : 5.9% , 13M
● Payment Processing Fee : 11.6%, 22M ● Maintaince : 6.1%, 25M ● Maintaince : 5.9%, 13M
36
Q5 - Brainstorming
Question 5 What are your recommendations for enhancing profitability for ABC Co.?
Increase Revenue Reduce Cost
Increase Visit Rate Reduce Costs in the Offline Channel

• Aromatic Displays Outside the Store, Visit Rewards (Due to lower gross margins and larger cost components, prioritize
Boost Traffic reducing costs in offline channels.)
• Complimentary Samples with Any Purchase, Fragrance Blending • Reduce Rent Cost: Sign long-term contracts to reduce rental
Workshops, In-store Product Trials, Special Gift Boxes for Holidays, costs, Increase the sales per square meter by placing high gross
Bundle Sales, Brand Image Improvement, Launch Events margin and best-selling products
Improve Repurchase Rate • Evaluate Personnel Efficiency : Part-time or flexible staffing

models during off-peak periods, Outsource non-core activities
• Loyalty Program, Customer Feedback Mechanism, Repeat Purchase
(cleaning, maintenance, etc.)
Discount
*Note: This is just one of many potential ways to structure your brainstorming ideas. Please treat this example only as a reference point
and develop your own style.
37
Q6 - Recommendation
The CEO has just entered the room and asked you to summarize your current
Question 6
recommendations.
Based on our analysis, we recommend that the client should focus on promoting the online channel by
Solution
sending fragrance samples to enhance customer satisfaction and repurchase rates.
• Online channels have shown an upward trend since the pandemic.

• The online store boasts the highest net profit at 68%, making it the most profitable channel among
all.
Reason
• According to the conversion rate data and consumer reviews, the purchase and repurchase rates of
the online channel are significantly lower than those of offline channels, due to the nature of
perfume products, which often require physical sampling.
However, our client should still pay more attention to the possibility of these activities incurring higher costs,
Risk
and online and offline channels could potentially cannibalize each other's sales.
We recommend further analysis of actual costs associated with these initiatives, and consider external
Next Step
factors (e.g. whether competitors are launching similar bundling promotions) to assess the actual benefits.
38
Profitability Case 2 – Tech Innovations Inc.
Case 2 – Tech Innovations Inc.

Case Prompt
Level: Easy
Tech Innovations Inc. (TII) provides a comprehensive suite of software solutions
Industry: Technology
designed to cater to the diverse needs of businesses across multiple industries. These
Expected Time: 15-20 mins
software products are hosted on cloud-based platforms, offering clients flexibility,
scalability, and accessibility. While the company has experienced steady growth in
#Brainstorming
recent years, its profitability has declined recently (2020-2021). TII hired your team to
identify the key factors affecting TII's profitability and to recommend strategies to
improve it.
• TII operates in a highly competitive market with 5 major players. • Encourage the interviewee to
• The company's revenue comes from the following products: ERP Software, Project develop a structured approach to
Management Tools, DA Platforms and Customer Support Solution. analyze TII's profitability.
• TII locates and provides services in the US. • Prompt interviewee to consider both
• TII's expenses include R&D, marketing, sales, and general administrative costs. revenue and cost factors that may
• TII aims to achieve a 3% increase in profitability within one year. influence profitability.
• Emphasize the importance of
identifying strategies to address the
challenges.
40
Case Questions
Calculate the expenses for TII in both 2020 and 2021. Identify the total fixed costs and the
2 total variable costs, and elaborate on any notable insights gleaned from the data.
3 How do we assess the revenue shortfall of TII?
4 Base on previous analysis, provide potential strategies to enhance TII's revenue.
The manager has just entered the room and they would like you to summarize your
5 conclusions.
41
Q1 - Structure
Revenue Costs External Factors
Price Costs Drivers Market Share

• Contribution of each price tier to TII's total • R&D • Demand for TII's software solutions
revenue and its impact on overall • Marketing Market Trends
profitability • Sales •Industry trends that impact TII's
Units • Administrative cost Competitive Landscape
• Sales and market demand for each
• Employee salaries • Level of industry entry barriers
product line •Market competitive conditions
• Overhead expenses
Product Portfolio Competitive Edge
• Performance of TII's product lines • Unique strengths that set TII apart from
Product Integrity its competitors
• Complete solution for products, flexibility,
integration capabilities
42
Q2 - Math
Calculate the expenses for TII in both 2020 and 2021. Identify the total fixed costs and
Question 2
the total variable costs, and elaborate on any notable insights gleaned from the data.
*Please share the following information Fix Cost Components 2020 (in millions USD) 2021 (in millions USD) Growth Rate
with the candidate: Exhibit 1 Salaries and Employee Benefits 255 250 -2%
Security Protection 105 110 5%
Software Licenses and Subscriptions 215 220 2%

Growth rate from 2020 to 2021
are marked red in the sheet: Rent and Utilities 310 400 23%
R&D 550 600 8%

Answer
Key Total 1,435 1,580 9%
Variable Cost Components 2020 (in millions USD) 2021 (in millions USD) Growth Rate %
Calculations
Customer Support and Service Costs 105 115 9%
Growth Rate (%)
= (2021 cost item – 2020 cost item) Sales Commissions 155 160 3%
/ 2020 cost item
Marketing and Advertising 165 145 -14%
Total 425 420 -1%
43
Q2 - Exhibit 1
Exhibit 1 Cost Structure of TII in 2020-2021
Cost Components 2020 (in millions USD) 2021 (in millions USD)
Salaries and Employee Benefits 255 250
Customer Support and Service Costs 105 115
Security Protection 105 110
Sales Commissions 155 160
Software Licenses and Subscriptions 215 220
Marketing and Advertising 165 145
Rent and Utilities 310 400
R&D 550 600
44
Calculate the expenses for TII in both 2020 and 2021. Identify the total fixed costs and
Question 2
the total variable costs, and elaborate on any notable insights gleaned from the data.

• The fixed costs encompass... (list the components), while the variable costs encompass... (list the components).
• Regarding fixed costs, there has been a notable 23% increase in rent and utilities. As for variable costs, there has been a
significant 14% reduction in the marketing and advertising category.

1. State the factors that influenced these two categories:
a. Rent and Utility costs increased:
i. Rent hikes due to increased demand for office space. Utility cost spikes due to changes in energy prices or
infrastructure upgrades.
b. Marketing and Advertising costs decreased:
i. Shift to digital marketing strategies, which can be more cost-effective than traditional advertising methods.
2. Strategies company could consider:
a. Remote work and implement energy-efficient measures like upgrading to energy-saving appliances.
b. Continue investing in digital marketing channels and refine strategies to maximize ROI.
45
Q3 - Profitability Assessment
After completing the analysis, the CEO felt that there was limited room for cost
Question 3
reduction, so they wanted to further analyze the revenue aspect.
Subscription-Based SaaS
Tier Price per user users in 2020 users in 2021 Calculation for 2020 Calculation for 2021 Growth Rate
Basic 240 / year 10,000 7,000 240*10,000 = 2,400,000 240*7,000 = 1,680,000 -43%
Standard 600 / year 5,000 4,000 600*5,000 = 3,000,000 600*4,000 = 2,400,000 -16%
Answer keys
and Enterprise 1,200 / year 2,000 2,500 1,200*2,000 = 2,400,000 1,200*2,500 = 3,000,000 20%
calculations
are shown in Total 7,800,000 7,080,000 -10%
the sheets:
Product Sales License Fee
2020 2021 Growth Rate 2020 2021 Growth Rate
12,000,000 11,000,000 -9% 8,000,000 7,500,000 -6%
46
Q3 - Exhibit 2
Exhibit 2 TII’s Revenue Components in 2020-2021
Tier Price per user users in 2020 users in 2021
Basic 240 / year 10,000 7,000

Subscription-Based
SaaS
Standard 600 / year 5,000 4,000
(*Need calculation*)
Enterprise 1200 / year 2,000 2,500
2020 2021
Product Sales
12,000,000 11,000,000
2020 2021
License Fee
8,000,000 7,500,000
47
After completing the analysis, the CEO felt that there was limited room for cost
Question 3
reduction, so they wanted to further analyze the revenue aspect.

• In 2021, there was a significant 43% decline in the Basic Tier Customer Base, likely influenced by the pandemic, contributing to
the shortfall in this customer segment.
• Why should we focus on analyzing subscription revenue?

○ The decline in subscription revenue is relatively larger
○ Besides subscriptions, the other two revenue streams mainly depend on key accounts and are not easily converted.
• Future Analysis
○ Is the pricing for the basic tier customer base too high?
○ Is there a significant gap between the actual functionality and the advertised features?
48
Q4 - Brainstorming
Question 4 How can we increase product sales and further enhance profitability?
New Products and Services
Transition & Upgrade - Innovate & Acquire -

Guiding Customers to New Offerings Attracting Fresh Interest in New Solutions：
1. Targeted marketing 1. Design digital marketing campaigns
2. Special upgrade offers 2. Establish partner collaborations
3. Bundle deals 3. Create whitepapers/case studies to attract
4. Early access leads
Old Audiences New Audiences
Retain & Upsell - Revive & Expand -

Leveraging Existing Customer Base： Reaching New Audiences for Legacy
1. Targeted campaigns Products：
2. Personalized offers 1. Limited-time discounts
3. Loyalty rewards 2. Free trials
4. Training sessions 3. Collaboration with influencers
5. Showcase additional features 4. Entering a new market
Old Products and Services
49
Q5 - Recommendation
The manager has just entered the room and they would like you to
Question 5
summarize your conclusions.
Based on our analysis results, we recommend that the client attract fresh interest and existing customer
Solution
base in new solutions through the initiative “Innovate and Acquire”.
• Based on the calculation results, cost is not the primary reason for declining profitability.
Reason • Being a major player in the market with an extensive existing product line can be leveraged as an
opportunity for bundle sales, offering a total solution.
However, our client should still pay more attention to:

• New solutions may struggle to gain traction, leading to slow adoption and potential revenue losses.
Risk
• Integrating new solutions with existing systems may present technical hurdles, compatibility issues, or
additional expenses.
Therefore, we recommend that our client need to understand customer needs, preferences, and market
Next Step
dynamics through market research. Validate the viability and demand for the new solutions.
50
Profitability Case 3 – AEC Co.
Case 3 – AEC Co.

Case Prompt
Level: Easy
Company AEC is a large international e-commerce company. The senior management Industry: E-commerce
has noticed that despite an increase in business volume, profitability has not risen Expected Time: 15-20 mins
proportionally with revenue growth. Consequently, they are seeking a team to provide
recommendations for improving profitability. #Cost-analysis
• Our client focuses on the Taiwan market. • Instead of asking upfront questions,
• The company operates its own warehouse. the interviewer provides exhibits based
• Market trend: There have been no major incidents in this market. on the interviewee’s questions.
• The client doesn’t have any specific goals to improve their profitability. • The Interviewee should lead the
• Focus solely on the C2C business model. discussion of the exhibits to reach a
• The company is concentrated on EC platform operations. conclusion.
• There are 4 dominant EC platforms in this market, with no significant changes in
recent years.
52
Case Questions
1 What factors would you like to investigate to help AEC increase its profitability?
After researching the revenue and finding no significant opportunities, the CEO wants to
2 focus on the cost segment. What are the major expenses of AEC?
3 According to the chart below, what insights have you found?
Currently, AEC sorts parcels manually, which is slow and costly. The CEO has found a
4 new sorting method that requires an investment of NTD 1.5 billion. Should AEC invest or
not?
5 recommendations.
53
Q1 - Structure
Question 1 What factors would you like to investigate to help AEC increase its profitability?
AEC Co. Revenue Cost External

Analysis Analysis Analysis Factors
Business Model Revenue Share Fixed Cost • Market trends

• Target Customers By Category • Marketing • Regulatory environment
Competitive Positioning • Average item price • Rent and utilities • Typical margin for
• Unique selling • Total units sold benchmarking
Variable Cost
proposition By Customer
• Labor
Operational Efficiency • Average order quantity
• Warehouse Operations
• Logistics
• Average spending
• Technology Utilization
• Discounts
Advertisement
• Retail Media Network
(RMN)
54
Q2 - Brainstorming
After researching the revenue and finding no significant opportunities,
Question 2 the CEO wants to focus on the cost segment.
What are the major expenses of AEC?
Fixed Cost Variable Cost
• Rent and utilities • Labor

• Maintenance • Discounts (Campaign)
• Marketing • Logistics
• Overhead • Transaction fee
• Returns and refunds
*Note: This is just one of many potential ways to structure your approach. Please treat this example only as a reference point and
develop your own style.
55
Q3 - Math
Question 3 According to the chart below, what insights have you found?

• Marketing, labor, and logistics are the main cost segments.
• Logistics has the highest growth, increasing form 20% to 25%.

• As revenue grows, costs will rise accordingly, but logistics and warehousing costs should decrease due to economies of
scale.
• The proportion of labor expenses has increased from 20% to 22%. It may be worth reviewing which departments have low
per capita productivity.
56
Q3 - Exhibit 1
Exhibit 1 AEC Co.’s Annual Costs in 2021 and 2023 (Unit: 100 million $NTD)
57
Q4 - Math
Currently, AEC sorts parcels manually, which is slow and costly. The CEO has found a new
Question 4 sorting method that requires an investment of NTD 1.5 billion. Should AEC invest or not?
*Please share the following information with the candidate:

• New sorting machine:
✔ Initial investment: 1.5B
✔ Useful life: 10 years
• Parcel:
✔ Order from customers: 20k parcels per day
*Please provide the additional information only upon request:

Before Investment: After Investment:
• Labor amount: 600 people / hour • Labor amount decreases 75% with the same working capacity.
• Average salary: 183 NTD / labor / hour • Maintenance cost: 3M / year
• Overall working capacity: 2.5k packages / hour
• Maintenance cost: 0.4M / year
• Working time: 300 days per year
58
Q4 - Math
Currently, AEC sorts parcels manually, which is slow and costly. The CEO has found a new
Question 4 sorting method that requires an investment of NTD 1.5 billion. Should AEC invest or not?
They could save 45M per year

• AEC should implement the new sorting machine because this new sorting
Calculations way could save 45M per year.
Initial investment
Sorting machine: 1.5B / 10 = 150M per year
OPS Savings
• With a high initial investment cost, AEC may face low flexibility in
Working time: 20k / 2.5k = 8 hr / day
Labor: (600 * 75%) * 183 * 8 * 300 = 197.6M per working capital.
5
• With higher work efficiency, it can afford more capacity for
year 9
company growth.
Increasing Cost
Maintenance cost: 3M - 0.4M= 2.6M per year • Instead of this new machine, there may be other methods that
could save costs with lower risk and investment.
Answer
-150M + 197.6M - 2.6M = 45M per year
59
Q5 - Recommendation
Question 5
recommendations.
Based on our analysis results, AEC is facing lower profitability despite growth in revenue, after our
Solution
analysis, we recommend that AEC should invest in the new sorting machine.
• This new sorting method could save 45M per year.

Reason
• With higher working efficiency, it can afford more capacity for company growth.
However, our client should still pay more attention to financial risks (with high initial investment costs, AEC
Risk may face low flexibility in working capital) and operational risks (long implementation period for software
and hardware customization, employee training, etc.).
Therefore, we recommend our client to check how to reassign extra labor to other functional teams and
Next Step
whether the new sorting machine will change the sorting quality and the overall implementation details.
60
Market Entry Case 4 – Tastea
Case 4 – Tastea
Case Prompt
Case Type: Market Entry
Level: Easy
Tastea, a Taiwanese handmade tea brand, offers more than a hundred tea varieties. Industry: Retail
The CEO is considering an aggressive expansion strategy by selling a specific type of Expected Time: 30 mins
black tea in the US market. Your team is tasked with providing detailed
recommendations to assist the company in promoting its products internationally. #market-selection
• The US population is approximately 330 million (2021). • This is a candidate-led case.

• The tea products consumed in the US are primarily bagged tea, accounting for • The candidate needs to conduct a
approximately 55%, and primarily driven by imported black tea. structured analysis of market sizing,
• The US tea market has shown continuous growth in both imports of black tea and apply business acumen to gather key
sales of tea bags. information, and evaluate qualitative
• Lipton, Tetley, and Twinings are the main competitors in the US tea market. issues in a logical manner.
• Your client prioritizes high-quality handmade tea, crafts a luxury brand image, and
utilizes both online and offline channels in sales.
• Your client has specific goals of achieving an 8 million profit and plans to import
their tea bag product into the US market, but Tastea has not yet entered the US.
62
Case Questions
1 Please assess the factors your client must consider when entering the US market.
Please analyze suitable market segmentation and its feasibility for your client in the US
2 market based on the information provided in Exhibit 1.
Assess black tea (tea bag) sales in the US for market size evaluation and determine the
3 market share needed for the goal of $8 million profit.
Would there be any benefits or risks to consider if the client exports their black tea (tea
4 bags) into the US market?
The manager has just entered the room and they would like you to summarize your
5 conclusions.
63
Q1 - Framework
Please assess the factors your client must consider
Question 1
when entering the US market.
Market Capability Financial Go-To-Market Advantages

Analysis Analysis Analysis Strategy and Risks
• Market size and Operational Capability Business Model Potential Partnership • Limitations on food &
forecasted growth • Human resources beverage (e.g., Good
Expected Profit Entering Methods
• Typical margin • Supply chain manufacturing
• Revenue analysis Marketing Strategy
• Major players and practices, Prior notice,
Financial Capability • Cost analysis • Promotion
competitive landscape etc.)
• Investment resources Expected Market Share • Place strategy • Related licensing (e.g.,
• Target segments and
• Required capex (NPV, • Value proposition Food facility
local preference Pricing Strategy
ROI, ROA etc.） registration, FDA, etc.)
Distribution Channels
• Import and export
tariffs
your own style.
64
Q2 - Segment selection
Please analyze suitable market segmentation and its feasibility for your client in
Question 2
the US market based on the information provided in Exhibit 1.
Candidate should refer to the Exhibit 1 for a comprehensive There isn't a standard answer, but we would
evaluation to suggest which market segment your client should hope the candidate considers the following
choose and provide the reasons for the recommendations. points when providing recommendations:
❖ Competitive landscapes in different

● Reference answer:
It is recommended that the client should target the mid-range market segment. segments
This is because the market has larger sales, diversified online and offline ❖ Consumer profiles
channels, making it easier to reach different customers while reducing the
operational costs of physical stores. Additionally, the competitive environment is ❖ The client's brand image and positioning
less intense, and our client enjoys several competitive advantages in this market ❖ The client’s competitive advantages and
segment. Also, it aligns with our clients’ pricing and profit objectives.
disadvantages in different segements
● Nice to mention:
Our client still needs to consider the impact of this strategy on their brand image, ❖ Financial goals
differentiation advantages compared to competitors and the customer loyalty in
the market segment.
65
Q2 - Exhibit 1
Exhibit 1 Different segments in US market
High-end Middle-range Low-end
Density: Low (3 key players) Density: Medium Density: High

Competitive
All competitors are multinational 65% of competitors are local companies, 90% of competitors are local companies, and
Landscape
companies. and 35% are multinational companies. 10% are multinational companies.
Customer Base: Small Customer Base: Medium Customer Base: Large

Consumer Information
Average Age of This Pool: 60 Average Age of This Pool: 40 Average Age of This Pool: 30
Typical Sales and

Market Size: 90 billion (Annually) Market Size: 105 billion (Annually) Market Size: 95 billion (Annually)
Pricing Ranges
(Each tea bag) Average Price: $0.15-$0.18 per tea bag Average Price: $0.1-$0.15 per tea bag Average Price: Below $0.07 per tea bag
Online Channels: 80% Online Channels: 60% Online Channels: 30%

Channel Distribution
Offline Channels: 20% Offline Channels: 40% Offline Channels: 70%
This segment is all about Most of the products in this segment are not
This segment is all about
Typical Product Type handcrafted roasted tea with a handcrafted tea, with only a small number of
non-handcrafted roasted tea.
focus on refinement. competitors focusing on handcrafted tea.
66
Q3 - Math
Assess black tea (tea bag) sales in the US for market size evaluation and
Question 3
determine the market share needed for the goal of a $8 million profit.
Market size evaluation for the black tea (tea bag) in the US is 27 billion USD.
● The formula = the population of the United States * the proportion of tea drinkers * the number of times tea is
consumed per year * the proportion of tea drinkers who choose tea bags * the proportion of those choosing black
tea US Calculation & # of People # times # times # times Annual tea bag sales
Population Ratio
Assumption (in million) per day per week per year volume (in billions)
330 million
Non-tea drinkers 15% 50 - - - -
Tea drinkers
Relevant Heavy 25% 70 2 14 700 17
choosing tea bags
values &
Assump- Medium 25% 70 1 7 350 8.5
tions 50%
Tea
drinkers Light 25% 70 - 1 50 1.2
Tea drinkers （85%）
choosing black tea drink
without 25% 70 - 0.5 25 0.6
70% addiction
Total : 27 billion
67
Q3 - Math
Question 3
The market share our client needs to achieve to reach an $8 million profit is 2%.
Assumptions & Additional Information: Calculations (For interviewers’ reference)

Interviewees should utilize these information from their
previous responses: 8 million 10% 80 million
• Based on Q3, demands for the same type of tea bags
goal of profit ÷ margin goal of sales
can reach roughy 27 billion units annually.

0.15
• The expected margin per tea bag is 10%. 27 billion 4.05 billion
unit price of each
annually demand sales annually
• Assume the price of each tea bag is $0.15. tea bag
• In calculations, the group who drinks without addiction 2%

can be excluded from consideration as they typically
80 million
goal of sales ÷ 4.05 billion
sales annually
goal of market
share
do not specifically purchase tea bag products.
68
Question 3

The annual sales of black tea (tea bag) are estimated at around 27 billion dollars in the US, and Tastea need to capture a 2% market share to
achieve their financial goals.

Interviewees can delve into more detailed discussions and assumptions for profitability, market share, and customer segment
(market conditions) along with the rationale behind these assumptions.
● Market share:
A 2% market share sounds like a reasonable goal for our client to achieve, but we still need to consider other market factors (such as competitor
situations, customer trends, and the timeline) to determine how to successfully launch this go-to-market strategy.
● Profitability:
If a 10% margin assumption represents the industry average and there are dominant players in the market, we could aim for a lower margin to
capture a larger market share and still achieve the $8 million profit.
● Customer segment:
In our market analysis, we categorize our customer base into four types. However, with more detailed data reflecting market insights, the estimated
market size and share might change, affecting our client's decisions on market entry.
69
Q4 - Brainstorming
Would there be any benefits or risks to consider if the client
Question 4
exports their black tea (tea bags) into the US market?
Benefits Risks
• By increasing overall sales, it can potentially secure more • xxx • Financial risks: lack of investment and funding,
Finance advantageous pricing from the distribution network.
Company negative cash flow, and potential future losses.
• Underestimated market share.
• Launching co-marketing campaigns to increase brand
Brand
awareness and promote the products.
Extension • Response from existing market competitors and
• It can increase brand exposure in the U.S. market.
Market new entrants.
Diversified • Expanding the sales channels and scale of the products, • Changes in customer behavior and preferences.
Operation providing access to a vast potential customer base.
• Compliance with food safety regulations.
• Adhering to local regulations, aiding Tastea in enhancing
• Import permits and certifications.
Scale-up quality and processes. Law
• Tariffs and import taxes.
Strategy • Allowing Tastea to learn new sales & marketing strategies
by collaborating with U.S. distributors and retailers. • Brand and patent issues.
*Note: This is just one of many potential ways to structure brainstorming ideas. Please treat this example only as a reference point and develop your own style.
70
Q5 - Recommendation
The manager has just entered the room and they would like you to
Question 5
Based on our analysis, we recommend that the client enter the U.S. market and aim for a 2% market share
Solution
to achieve their financial goals.
• Based on the calculation results, the U.S. tea market is large, and achieving a 2% market share is
feasible given the client's previous operating experience in the U.S. market.
Reason
• Additionally, importing new products can offer advantages in terms of revenue and cost reduction,
aligning with our client's aggressive expansion strategy.
However, our client should still pay close attention to market responses, new threats, legal restrictions, and
Risk
potential negative impacts on existing business operations.
Therefore, we recommend that our client conduct further analysis of their competitive advantages and
Next Step
perform sales simulations to assess the potential impact of the strategy on the company.
71
Market Entry Case 5 – Weight-Loss Injection
Case 5 – Weight-Loss Injection

Case Prompt
Level: Easy
Our client is a multinational pharmaceutical company that has recently developed Industry: Healthcare
a new drug, a subcutaneous injection for weight loss, and is currently evaluating its Expected Time: 30 mins
potential for entering the Taiwanese market. Please assist them in assessing
whether to introduce this new product into the Taiwanese market. #market-sizing
Additional Information (If asked) Product Information
• The product has been launched in the US market and is FDA-approved. • This medication works by stimulating
• It is an imported drug (production-related information is not considered) insulin secretion through Glucagon-Like
• There are already two companies producing oral weight loss drugs in the Peptide-1 (GLP-1) analogs, delaying
Taiwanese market, but no injectable weight loss drugs yet. gastric emptying, and creating a sense of
• The target user age range is between 18 and 65 years old (excluding patients fullness, thereby controlling weight.
with insulin-related diseases, such as Type 1 and Type 2 diabetes, and those • Compared to oral administration,
with general injuries or illnesses). subcutaneous injections result in faster
• The company anticipates achieving $100 MM in revenue within 3 years. absorption of medications, leading to a
• Patients administer the injection daily for a 12-week period (84 days). quicker onset of action.
73
Case Questions
What factors would you consider when deciding whether to introduce the new drug into
1 the Taiwanese market?
Please estimate the number of people in Taiwan who may need weight loss injection
2 treatment in one year.
From a financial perspective, would you recommend the client introduce the new drug into
3 the Taiwanese market?
If the client is considering entering the weight loss drug market. What short, medium, and
4
long-term plans should be made from an implementation perspective?
74
Q1 - Structure
What factors would you consider when deciding whether to
Question 1
introduce the new drug into the Taiwanese market?
Market Go-To-Market Advantages

Attractiveness Feasibility
Strategy and Risks
Market size and growth Financial analysis Pricing strategy Advantages

potential • Revenue analysis • Negotiations with • Brand awarness with first
Consumer (Patients) • Current financial status healthcare payers and weight loss injection
• Demographics • Expected primary institutions product
• Preferences invesment and Distribution Risks
Competiton evaluation metrics • Hospitals, clinics, or • Cannibalization of the
• Key players Operation analysis external partners current weight loss
• Substitutes • Management team Pilot plan product, if any
• Market share • Capabilities (Taiwanese • Political issues
Sales, etc.)
your own style.
75
Q2 - Math
Please estimate the number of people in Taiwan who may need weight loss
Question 2
injection treatment in one year.
64K individuals per year

*Not specifically considering the health insurance market
Calculations
23 million 70% 40% 6.4 million

of the population falls within prevalence of
people in Taiwan Potential patients
the 18-65 age range overweight and obesity
6.4 million 10% 10% 64K

of the potential patients of the potential patients interested in
Potential patients individuals
seeking treatment annually or eligible for injection treatments
76
Q3 - Math
From a financial perspective, would you recommend the client introduce the new
Question 3
drug into the Taiwanese market?
The new drug will generate TWD 161,280,000 in total over three years
Assumptions & Additional Information: Calculations

• Usage Frequency: Patients administer the
• 64K (population might need weight-loss injection from
injection daily for a 12-week period (84 days).
Question 2)*84 (days) / 7 (days per unit) = 768K units
• Pricing: TWD 3,000/unit, with each unit lasting 7
• 768K units * TWD 3000 (per unit) =TWD 2,304M
days.
• Year 1: TWD 23,040,000 = TWD 2,304M * 1%
• Estimated Market Shares Over Three Years: 1%,
• Year 2: TWD 69,120,000 = TWD 2,304M * 3%
3%, and 7%, respectively (subject to interviewer
• Year 3: TWD 161,280,000 =TWD 2,304M * 7%
assumptions)
• TWD 161,280,000 in total > 100,000,000 in
expected revenue
77
From a financial perspective, would you recommend the client introduce the
Question 3
new drug into the Taiwanese market?

• Correct calculation based on the assumptions of drug usage frequency, product price, and estimated market shares over three years

Interviewees can delve into more detailed assumptions for pricing, product usage, and market share, along with the rationale behind
these assumptions
• Pricing: the weight-loss injection treatment offers significant value and effectiveness compared to other available options.
• Product Usage: based on typical treatment regimens for weight-loss injections, which often require multiple doses over an
extended period for optimal results.
• Market Share: 1% in Year 1, 3% in Year 2, and 7% in Year 3 are conservative yet realistic projections based on the expected
adoption and penetration of the new drug in the Taiwanese market.
○ First year: the product establishes its presence, gains regulatory approvals, and builds awareness among healthcare
providers and consumers.
○ Second year: assuming successful market entry and positive reception, leading to gradually higher market share.
○ Third year: with continued positive patient outcomes and potential endorsements from healthcare professionals.
Note: 78
Q4 - Implementation Plan
The client is considering entering the weight loss drug market. What short,
Question 4
medium, and long-term plans should be made from an implementation perspective?
• Cost and time required for drug licensing (regulatory aspect).

Short-term • Assess health insurance coverage and its impact on the number of people using the medication.
• Distribution channel confirmation:

○ Aesthetic clinics, hospital centers, regional hospitals, local hospitals.
Mid-term
• Methods of promotion for each channel (regulatory considerations).
○ Representatives or media channels: social media/self-media, lectures.
• Market competition status (drug pricing and market positioning adjustment).

Long-term
• Drug effectiveness and feedback from physicians.
Interviewer • Operational aspect: health insurance, regulatory constraints, health insurance coverage.
Guidance • Time planning: differentiating short, medium, and long-term concepts.
79
Case 6 - Enigma Smartphone
Market Entry
Market Entry Case 6 – Enigma Smartphone
Case 6 – Enigma Smartphone

Case Prompt
Level: Medium
Enigma, a leading software company dominant in search engines, is considering Industry: Technology
entering the smartphone market to develop its own brand. Their business has Expected Time: 30 mins
experienced slowing growth. Accordingly, they seek growth opportunities and plan to
use the US as the initial market. Enigma has hired us to help them evaluate the #market-sizing #market-selection
potential of entering the smartphone market.
• The client focuses on the U.S. market. In this case, the candidate needs to break
• Enigma’s financial objective is to at least break even in 3 years. down the problem, conduct market sizing,
• Our client primarily provides search engine services, generating revenue through interpret charts, apply business acumen to
advertisements (90%). Additional revenue comes from apps and media (8%) and evaluate qualitative issues, and provide
cloud services (2%). strategic recommendations to the client.
• Our client acquired the mobile operating system company Mobius 5 years ago.
Currently, they have integrated the system into the new models of mobile phones
supplied by NOVA, a leading smartphone brand.
81
Case Questions
What factors would you consider when deciding whether to develop their own
1 smartphones?
2 Please estimate the market size of smartphones in the US market in 2023
Our client is asking which price range for smartphones is the best to enter the market
3 and why?
Would there be any synergies or risks to consider if our client would like to develop their
4
own brand smartphone?
82
Q1 - Framework
What factors would you consider when deciding
Question 1
whether to develop their own smartphones?
Market Capability Profitability Go-To-Market Advantages

Analysis Analysis Analysis Strategy and Risks
Market size and Financial Capability Revenue Analysis Entering Methods Risk
forecasted growth • Investment • Price Tier Distribution Channels • Limitations
Competitors • Financial Health • Sales Volumes Marketing Strategy • Rapid Tech Shifts
• Landscape Opetational Capability Cost Analysis • Value Proposition • Financial Risk
• Market Share • Human Resources • Fixed Cost (R&D, • Place Strategy Advantage
Market trends • Supply Chain Facilities, etc.) • Promotion • Synergy
Target Audience Technical Capability • Variable Cost Potential Partnership • Innovation in the
(Software, hardware market
Component,etc)
your own style.
83
Q2 - Math
Question 2 Please estimate the market size of smartphones in the US market in 2023
Please provide these additional information only upon request:

• US population: 300 M
• Average smart phone price: $770 USD
• Average replacement cycle: 4 years
• If the interviewee proposes a formula including all the elements above, please show the next page
Calculations (For interviewers’ reference)
Average holding Average Average

Population Penetration Rate
number Price replacement cycle
84
Q2 - Exhibit 1
Exhibit 1 Smartphone Market Penetration and Average Holdings by Age in US (2023)
Penetration Rate Average holding

Age % of Population
number
<15 20% 70% 1
15 - 30 20% 90% 1.2
30 - 45 20% 80% 1.6
45 - 60 20% 70% 1.4
60+ 20% 30% 1
85
Q2 - Math
The market is estimated to generate 50 billion USD in 2023.
Calculations
Average holding Average Total Sales
Age Population Penetration Rate
number replacement cycle Volume
<15 60M 70% 1 4 10.5

15 - 30 60M 90% 1.2 4 16.2
30 - 45 60M 80% 1.6 4 19.2
45 - 60 60M 70% 1.4 4 14.7
>60 60M 30% 1 4 4.5
Total Sales Volume: 65.1M Average Price: $770 50B USD
86

• Correct calculation based on the assumptions of penetration rate, average holding number, replacement cycle, and different
customer segments.

Interviewees can delve into more detailed assumptions for structure and give the insights after calculating the right number
• Structure & Insights:

○ Clearly articulate a multi-layered structure with detailed assumptions for each level, and interpret the number and offer
your unique insights and perspectives on the calculated market size.
• Calibration & Refinement:
○ Demonstrate speed and accuracy in calculations, and identify potential overestimation or underestimation based on your
analysis, and propose adjustments to improve the accuracy of the market sizing.
• Proactive Problem-Solving:
○ Proactively push the project forward by suggesting what additional data or information is crucial to refine the market sizing.
87
Q3 - Market Selection
The client seeks advice on the most advantageous smartphone price range for
Question 3
market entry and the rationale behind it
*Please provide these additional information only upon request:

• Initial Investment: 1 billion USD
• Assumption:
✔ While market growth and changes in the market landscape are important considerations, they should not be discussed in this case
✔ Please consider depreciation and currency devaluation
Calculations
Mid-range is the most • Formula: Market Size * Market Share after 3 years * Margin - Initial Investment
advantageous price for • Premium: 10B * 5% * 80% - 1 B = - 0.6 B
estimated 0.5 billion return after • Mid-range: 25B * 20% * 30% - 1 B = 0.5 B
3 years • Low-range: 15B * 25% * 20% - 1 B = - 0.25 B
88
Q3 - Exhibit 2
Exhibit 2 Smartphone Market Portfolio
Premium (Above $800)

● Market Share after 3 years: 5%
● Typical Margin: 80%
Mid-range ($400-$800)
Low-range (Below $400)

89
Q4 - Brainstorming
Would there be any advantages or risks to consider if our client would like to
Question 4
develop their own brand smartphone?
Advantages Risks
•Company
xxx ● Impact on the relationship with NOVA
● Integrate with existing business like cloud services
● Effect on Enigma's brand image
and search engines to strengthen competitive
Synergy advantages ● Response from existing market competitors
● Introduce the mobile operating system - Mobius into and the newcomers
own brand smartphone to reduce R&D costs
Market ● Smart phones are easily outdated because of
rapid market trends
● Diversify revenue sources to lessen reliance on
● Low consumer acceptance of new brands
Strategic advertising
Goal ● Seize the opportunity to establish a presence in the ● Technical barriers
fast-expanding consumer electronics market
Feasibility ● Large Investment in R&D and manufacturing
*Note: This is just one of many potential ways to structure your brainstorming ideas. Please treat this example only as a reference point
and develop your own style.
90
Q5 - Recommendation
Question 5 The CEO of Enigma entered the office to seek your recommendation
Based on our research, we recommend our client develop their own brand smartphone and target the
Solution mid-range price segment. This approach is expected to generate a 10% market share and a profit of 0.75
billion USD within 3 years of entering the market.
• The mid-range market size is 25 billion USD, which is much larger than the other two segments. This
market is also quite fragmented, presenting a good opportunity for penetration.
Reason
• For the company, developing their own smartphone brand will create synergies with existing
businesses and supply chains, which can increase revenue and reduce costs.
However, it is important to consider the financial and technical feasibility of developing a smartphone, as
Risk
well as the current relationship with existing partners and the public's brand image of Enigma.
Our next steps should focus on consumer research, targeting different age groups. We also need to
Next Step
identify potential partners and carefully evaluate the most suitable entry strategy, such as M&A or R&D.
91
Case 7 - Rapid Co.
M&A
M&A Case 7 – Rapid Co.
Case 7 – Rapid Co.

Case Prompt
Case Type: M&A/Profitability
Level: Medium
Rapid Co., a US-based vehicle manufacturing company, has encountered a drastic Industry: Automotive
profit decrease issue recently. The CEO has brought you in to help identify the root Expected Time: 15-20 mins
cause and come up with a solution.
#Cost structure
• Rapid Co. specializes in the automotive assembly and sales with a primary market ● The interviewer can lead the
focus on middle-income segments. interview based on the question
• The profitability for 2023 was -12%, which was atypical in the industry that year. order.
• The portfolio consists exclusively of gasoline vehicle covering 3 vehicle types: ● The interviewee needs to identify
Sedan/SUV/Coupes (Overall product mix has not changed in recent years.) key costs and provide acquisition
• Main competitors includes Ford, Toyota and other independent companies advice based on their calculations.
targeting the middle and lower market. The majority have no profit issues.
93
Case Questions
2 Given that the Fixed Cost remains the same. What is causing the decrease in profit?
3 How to address the increasing cost problem? Please consider both short-term and long-term plans.
The CEO decides to execute a vertical acquisition to solve the issue at hand. Considering potential price premium
4 and capacity, which of the following companies might represent a favorable acquisition target?
5 What are additional factors to consider before M&A?
6 The CEO has just entered the room and they would like you to summarize your conclusions.
94
Q1 - Structure
Automotive Rapid Co.

Market
Industry Operational • Cost Sructure

• Typical Margins • Product Portfolio Sales Condition (by vehicle ○ Fixed Cost
• Market Growth types/ by power source type) ■ PP&E
Competitors • Regional Sales Condition ■ SG&A
• Revenue Fluctuation of • Distributor Management ■ Utility
Major Players • Supplier Management ○ Variable Cost
• Cost Structure of Major • Operation Efficiency ■ Components:Chassis/ Drivetrain
Players Financial / Vehicle Body / Equipment
Customer • Revenue Structure ■ Labor
• Customer Preference ○ Price of Sedan/SUV/Coupes ■ Transportation
Change ○ Quantity of Sedan/SUV/Coupes sold ■ Sales Force Commision
95
Q1 - Interviewer Guide

• Offer Top-down overview of structure on factors to be considered, including external market conditions & internal situation.

Interviewees can dive into more detailed assumptions for factors to be considered in the automotive market, along with the
rationale behind these assumptions
● Market Growth: 5% growth in the automotive market is a neutral expectation in the global market. The US automotive
market bears 2-3% in CAGR.
● Profit Margin: the typical profit margin for a general automotive player is 4-15%, 20% or above for Supercar.
9
Note:
● Cost Components: The cost components of an automotive manufacturer include capital 6expenditure and variable cost
components like Chasis, Vehicle Body, Drivetrain and Equipment
Can verbally dictate what is the process to address the problem and prioritize the potential factors to be addressed with
reasonable assumptions.
96
Q2 - Analysis
Given that the Fixed Cost remains the same.
Question 2
What is causing the decrease in profit?

The revenue is increasing 3% in the previous year, which is normal compared to the total estimated US market growth of 2-3%.
• “Drivetrain” parts encounter a drastic cost increase. Drivetrain Cost Growth Percentage of
• “Transmission” components is facing a 33% price Components (2022-2023) TTL VC (2023)
increase (the highest) from original supplier.
Engine 8.7% 11.6%
• Calculation answer keys are shown in sheets:
Auxiliary Units 15.4% 6.9%
Year Variable Cost Growth

Transmission 33.3% 9.3%
2021 -
Exhaust System 25% 4.7%
2022 5.26%
Others 33.3% 3.7%
2023 7.5%
97
Q2 - Exhibit 1
Exhibit 1 Total Variable Cost (Unit: USD in millions)
7.8
6.5
21.5
20.0 2.5
19.0 2.3 Engine
Chasis
1.5
Vehicle Body 1.3 Auxiliary Units
Drivertrain 2.0
1.5 Transmission
Equipment
0.8 Exhaust System 1.0
Others 0.6 Others 0.8
2021 2022 2023 (2022) (2023)
98
Given that the Fixed Cost remains the same.
Question 2
What is causing the decrease in profit?

• Correct observation based on exhibit 1. The interviewee should be able to analyze the primary cost drivers.

Interviewees may derive insights from the analysis of chart information:
• Cost growth: variable cost growth in 2023 is 7.5% compared to 3% growth in revenue, confirming that the enterprise is
facing a components price increase.
• Price Increase: Potential factors contributing to a transmission price increase may include insufficient materials, the
retirement of old products, or new contracts with different suppliers
Note:
• Address key components: identify the specific components within high cost-growing drivetrain or high-volume
equipment categories that contribute significantly to overall cost
99
Q3 - Brainstorming
How to address the increasing cost problem?
Question 3
Please consider both short-term and long-term planss.
Short-term Long-term
Original New
Alternative R&D M&A
Supplier Supplier
• Deep Negotiation • Signing a short-term • Self-produced • Searching for valuable

○ Long-term contracts bargain contract with components target for long-term cost
○ Partnership (R&D/ new supplier • Develop efficient down
Patent…) • Expand the search for manufacturing
• Cost down on other suppliers globally processes
components • Investigate and develop
alternative materials
100
Q4 - Math
The CEO decides to execute a vertical acquisition to solve the issue at hand.
Question 4 Considering potential price premium and capacity, which of the following companies
might represent a favorable acquisition target?

• Discounted Rate: 6%
• Capacity Threshold: Rapid co. yearly capacity is 1M (The target should cover the capacity)
• Target Company Status: The candidates’ portfolio includes diverse products (other than transmission)
Estimated Value Future Cash flow ( Discount Rate CF Growth Rate )
Price Premium ( Deal Price Estimated Value ) Deal Price
Yearly Capacity Capacity (/week) 50 (weeks of a year)
101
Q4 - Exhibit 2
Exhibit 2 Target companies’ profile
Transmission
Basic Info Future Cash Flow
Production
Company Names Deal Price Capacity(/week) Cash Flow (T=1) Expected Growth
FFlogan Co. 8.5 B 10,000 $ 150 M 4.0%
Richard Co. 12.0 B 24,000 $ 300 M 3.0%
Okie Co. 12.0 B 20,000 $ 220 M 4.0%
Holmes Co. 11.0 B 18,000 $160 M 4.5%
*Note:
● Growing Perpetuity Formula: Value = Cash Flow / (Discount Rate-Growth Rate)
● Price Premium: (Target Price-Value) / Value
102
Q4 - Math
The CEO decides to execute a vertical acquisition to resolve the issue at hand.
Okie Co. is the candidate company that fullfills the price premium and capacity requirement. The Holmes
is a charming bargain to be considered with capacity close to the requirement and a lower price premium.
FFlogan Co. Okie Co.

Estimated Value 150M / (6%-4%) = 7.5B Estimated Value 220M / (6%-4%) = 11B
Price Premium (8.5B-7.5B) / 7.5B = 13.33% Price Premium (12B-11B) / 11B = 9.09%
Yearly Capacity 10,000*50 = 0.5M < 1M (Requirement) Yearly Capacity 20,000*50 = 1M = 1M (Requirement)
Richard Co. Holmes Co.

Estimated Value 300M / (6%-3%) = 10B Estimated Value 160M / (6%-4.5%) = 10.67B
Price Premium (12B-10B) / 10B = 20.00% Price Premium (11B-10.67B) / 10.67B = 1.03%
Yearly Capacity 24,000*50 = 1.2M > 1M (Requirement) Yearly Capacity 18,000*50 = 0.9M < 1M (Requirement)
103
The CEO decides to execute a vertical acquisition to resolve the issue at hand.

• Clarify the big picture of the formula, the expected outcome, and missing parts in the formula. Correct calculation based on
exhibit 2. The interviewee should be able to filter and prioritize the potential options.

Interviewees may derive insights from the analysis of chart information:
● Valuation risk: given the mixed projections for the company and overall market conditions, it's advisable to exercise
caution regarding potential growth fluctuations, e.g., the electrical vehicle may hold different vehicle structures with a
drastic shift in the components market
Note:
● Potential substitution: be aware of the potential bargain in the list, e.g.,” Holmes Co. is not fulfilling the capacity
threshold with a 0.1M gap, yet the price premium is relatively low. The client can think of a tradeoff of investment in
capacity expansion.”
104
Q5 - Brainstorming
Question 5 What are additional factors to consider before M&A?
Target
Synergies Strategic Fit Risk
attractiveness
Market Share Revenue • Portfolio Diversification Financial

Competitive advantage Cost • Market Diversification • Debt burden
• Unique Patent • Direct: Overhead Costs, • Brand Merge • Broken Capital Chain
• Process Efficiency Production Control, • Product Quality • Integration costs
• High Value Branding Procurement Costs Development Operational
• Efficient Logistics • Indirect: SG&A, Shared • Cultural Fit • Loss of Key Employees
• Diverse Partners • Technology Platforms • Regulatory Hurdles
Location Operational • Distraction from Core
Client base Business
105
Q6 - Recommendation
The CEO has just entered the room and they would like you to
Question 6
The profitability issue arose from a drastic increase in transmission costs. To mitigate the long-term cost
Solution increase through M&A, Okie Co. is the target company that meets the price premium and capacity
requirement.
• Sufficient capacity 1M fulfilling the requirement

Reason • Estimated value of 11M with lowest price premium of 9.09% in the candidate list
• High cash flow, expected to own a diverse product portfolio or outstanding sales performance
However, there are potential risks that replacing suppliers may cause temporary quality issues due to
Risk inconsistencies in the components delivered, and the target company may encounter a dilemma on
top-line expansion while receiving contracts from other direct competitors.
We recommend Rapid Co. should conduct detailed due diligence on the business model, operation
Next Step system, management structure etc. to validate the valuation. Besides, Rapid Co. should conduct factory
visits, and develop a complete sampling & testing process to ensure fluency on the components switch.
106
Case 8 - Inu group
M&A
M&A Case 8 – Inu group
Case 8 - Inu group

Case Prompt
Case Type: M&A
Level: Medium
Our client is Inu group, with business spanning retail, logistics, etc., its subsidiary Inu Industry: Retail
Convenience Store is the chain with the highest number of stores in Taiwan. Expected Time: 20-30 mins
As part of its growth strategy, Inu group has analyzed potential acquisition targets, and
identified Roufferac, also in the retail sector, as a target acquisition. Roufferac owns a #Financial Analysis #Due Diligence
certain number of supermarkets, with a sales format different from convenience stores.
Inu group has hired us to conduct due diligence and help them understand whether
they should make this investment.
• Current proposed acquisition price is $1 billion NTD. • The interviewer can lead the interview
• The goal of this acquisition is to achieve a payback period of three years. based on the question order.
• Our client (Inu group) primarily focuses on the Taiwanese market. • The interviewee should identify
• Inu leads the industry in warehousing and logistics, and the acquired company potential synergies from the acquisition
can directly integrate and share these resources. and make a decision based on the
• The suppliers and brands of Inu and Carrefour are largely the same, with only payback period.
some pricing differences for certain products.
108
Case Questions
What areas would you want to explore to determine whether they should proceed with the
1 acquisition?
2 What potential synergies might Inu group capture by acquiring Rofferac?
The current operational status of Roufferac is as follows. Please evaluate if Inu group is
3 possible to achieve the payback period goal of 3 years.
4 Evaluate the payback period for Inu group acquiring Rofferac
Our client is waiting and she wants to know what our initial findings and recommendations
5 are. What do you tell her?
109
Q1 - Structure
What areas would you want to explore to determine whether they should
Question 1
proceed with the acquisition?
Company Bidder
Market Synergies
-Roufferac - Inu group
Retail Industry Financials Financials Management Team

• Retail format • Revenue • Cash ratio • Management quality
• Market Size • Profitability • Fund structure • Team replacement
• Growth rate • Assets & liabilities Resource Capacity
• Cultural fit
• Entry barriers Product • Acquisition experience
• Acquisition Experience
• Market concentration • Product categories • Group industry
Customers • Price levels characteristics
Other Factors
• Customer Segment • Service types M&A Considerations
• Customer Behavior Competitors • Acquisition rationale • Stockholder’s opinion
Layout • Main competitors • M&A strategies • Regulatory / legal risks
• Geographic distribution • Threads • Right timing • Reinvestment risk
• Store density Brand
• Brand influence
• customer loyalty
110
Q2 - Brainstorming
What potential synergies might Inu group capture
Question 2
by acquiring Rofferac?
Revenue Enhancement Cost Reduction
Volume Synergies Direct Costs

• Customer base Integration: Combining customers from • Large-scale purchasing: Obtain supplier discounts
Rofferac • Inventory management: Merge redundant distribution centers
• Market penetration: Integrating more customer data and warehouses
• Increase in sales outlets: Expanding into new markets • Logistics and distribution efficiency: Optimize logistics routes
• Product diversification: Increasing revenue streams Indirect Costs
• Human resource integration: Streamline redundant
Price Synergies management and administrative levels
• Pricing power: Stronger bargaining power through market • Marketing Strategy: Joint marketing to reduce unit
share expansion advertising costs
• Cross-selling Opportunity: Increasing customers’ willingness • General & Administrative Expenses: Streamline redundant
to pay management levels and consolidate offices
111
What potential synergies might Inu group capture
Question 2
by acquiring Rofferac?

Candidates should discuss potential synergies by breaking them down into two aspects, revenue enhancement and cost
reduction, and list out the synergies they may generate
“Of all the revenue synergies, enhancing market “Since product costs account for the largest portion of total costs, the
penetration rate will be the most important focus effect of large-scale purchasing is the most important. It can
for Inu group. Not only would more customer data significantly improve profit margins, immediately reflect cost reductions
be collected, but it would also be used to support in financial statements and enhance bargaining power with suppliers.
the implementation of other strategies, such as Unlike other synergies, large-scale purchasing does not incur
product diversification and pricing strategies.” restructuring costs like severance pay, relocation expenses, etc.”
112
Q3 - Math
The current operational status of Roufferac is as follows. Please evaluate if Inu
Question 3
group is possible to achieve the payback period goal of 3 years.
It is insufficient to achieve the goal of recouping the acquisition price within three years.
• The interviewer should start by providing a brief overview of the financial information, noting that based on the
current annual net income, it is insufficient to achieve the goal of recouping the acquisition price within three years.
○ Net income : $270,000,000 NTD per year
○ $270,000,000 X 3 = $810,000,000
• The interviewer should further inquire whether Roufferac has any projected growth rate information. A strong
candidate would ideally present a structured framework first :
○ Revenue and cost changes
○ Market competitors
113
Q3 - Exhibit 1
Exhibit 1 Current Operational Status of Roufferac
Revenue Cost
Sales of goods $500,000,000 COGS $200,000,000

Labor cost $30,000,000
Service income $10,000,000
Rental cost $10,000,000
Slotting fee $10,000,000
Operating expense $10,000,000
Advertising income $10,000,000
Advertising cost $5,000,000
Online sales $20,000,000
Capital expense $15,000,000
Total revenue $550,000,000
Online service expense $10,000,000
*Notes:
Total cost $280,000,000
● Slotting fee：A one-time fee that suppliers pay to retailers for
shelf space to display their products.
● Service revenue： includes income from installation,
maintenance, delivery, technical support, equipment rentals,
and in-store services.
114
Q4 - Math
Question 4 Evaluate the payback period for Inu group acquiring Rofferac
*Please share the following information with the candidate: *Please provide these additional information
- Exhibit 1 & Exhibit 2 only upon request:
- The average inventory remains unchanged. • The conversion rate of online members
- The number of suppliers this year is 1.2 times the remain unchanged.
number of last year. • Inu group did not merge Roferrac’s online
platform into its original platform.
Inventory Turnover Cost of Goods Sold Average Inventory
Profit Margin ( Sales of Goods Cost of Goods Sold ) Sales of Goods
115
Q4 - Math
Exhibit 2 The performance forcast of Roufferac after being acquired
Original conditions Expect Changes
Inventory Turnover 1 + 50%
Profit Margin 0.6 + 25%
Advertising Income 10M

same as sales of goods
Service Income 10M
Online Members 2,000 people 5,000 people
Indirect Cost 70M decrease 10% in total
Online Service Expense 10M + 0%
116
Q4 - Math
The payback period for Inu group to acquire Rofferac is 1.13 years.
- Gross profit margin = 60%*125% = 75%

- COGS：1.5* 200M = 300M
- Inventory turnover = 1*1.5 = 1.5
Sales of goods 300M / (100%-75%) $1,200M
Slotting income 10M *（1+ 0.2） $12M
Advertisement and service income (10M + 10M) * (1200M / 500M ) $48M
Total Cost 300M + 10M + (70M * 0.9) $373M
Average annual cash flow (1200M + 12M + 48M) - (373M) $887M
Payback period 1B / 887M 1.13years
117

• Correct Calculations base on Exb.1&2. Clarify each assumptions and know the relationship between future conditions and
the financials.

Interviewees may derive insights from the analysis of the assumptions:
● Inventory turnover improved: More efficient inventory management systems were implemented.
● Gross profit margin increased: Cost control measures and supply chain efficiencies reduced product costs.
● Number of online members increased: Promotions and membership programs attracted more customers.
Note:
● Advertising and service revenue increased with sales: Higher sales boosted brand visibility and attracted more advertising
and service opportunities.
● More suppliers: The acquisition brought in more suppliers, offering a wider range of products.
● Indirect costs decreased: Economies of scale and resource integration improved operational efficiency.
118
Q5 - Recommendation
Our client is waiting and she wants to know what our initial findings and
Question 5
recommendations are. What do you tell her?
Based on the initial assessment, Inu group should acquire Roufferac to expand its business scope in a
Solution promising market situation.
• In retail industry, customers highly value convenience of shopping and product pricing. This merger can
enhance the density of store distribution and provide more opportunities to implement pricing strategies
and cross-selling strategies to meet customer needs.
Reason • Gaining more customer information allows for more precise strategy formulation and better
development of online platforms to expand sales channels and service categories.
• An average annual cash flow of $887 million is a highly attractive acquisition indicator in the Taiwanese
retail industry.
However, there are two risks to consider. One is legal risk: the two companies are both in the retail
Risk industry, which may involve antitrust law. The other one is coordination risk: in the early stage of the
merger, differences in team culture and organizational structure may decrease work efficiency.
Therefore, we recommend Inu group communicate with internal shareholders to decide on merger affairs,
Next Step and hire legal and accounting experts to assist in negotiating the final purchase price.
119
Case 9 - Travel Tycoon
M&A
M&A Case 9 – Travel Tycoon

Case Prompt
Case Type: M&A
Level: Hard
Travel Tycoon is one of the world's largest online travel agency (OTA) search platforms, Industry: OTA
offering a range of travel services including accommodation bookings, restaurant Expected Time: 20-30 mins
reservations, and transportation ticket price comparison and booking. With the OTA
industry gradually recovering post-pandemic, Travel Tycoon is currently considering #Financial Analysis
whether to acquire Price Searcher, an OTA price comparison platform focused on
accommodation, to capitalize on greater profitability in a promising industry landscape
and trends. Their CEO has reached out to you to help them justify this decision.
Interviewer Guidance
• The interviewer can lead the interview

based on the question order.
• The interviewee should identify
potential synergies from the acquisition
and make calculate payback period.
121

Additional Information (If asked)
• Travel Tycoon would like to payback their investment within 4 years after the acquisition.
• Price Searcher boasts a large customer base and is currently experiencing modest growth. However, its recent stock performance has
been poor. Travel Tycoon’s CEO believes that acquiring Price Searcher at this time could minimize the acquisition cost.
• Travel Tycoon’s current market capitalization is $120B. Its revenue and cash flow in 2023 were $20B and $12B respectively.
• Travel Tycoon has extensive experience in acquiring well-known online travel agencies.
• Travel Tycoon’s primary business model is “agency”, which earns profits by extracting commissions from traveler bookings. (Provide
Exhibit 1)
• Price Searcher’s primary business model is “meta search”, which earns advertising fees by redirecting travelers to other OTA websites
to complete bookings.
• Customers in the OTA industry are mostly price-sensitive, seeking a better one-stop shop customer experience.
122
Prompt - Exhibit 1
Exhibit 1 Travel Tycoon's business model and services provided
Agency Meta Search
Accommodations
Ground Transportations
Flights
Restaurants
123
Case Questions
What areas would you like to investigate to determine whether Travel Tycoon should
1 acquire Price Searcher?
2 What potential synergies might Travel Tycoon capture by acquiring Price Searcher?
3 What is the payback period for Travel Tycoon acquiring Price Searcher?
4 recommendations.
124
Q1 - Structure
What areas would you like to investigate to determine
Question 1
whether Travel Tycoon should acquire Price Searcher?
Target - Acquirer -
Market Synergies
Price Searcher Travel Tycoon
Industry Financial Analysis Internal Analysis Synergy Analysis

• Market Size • Financial Position • Strategic Planning • Revenue Enhancement
• Market Growth • Valuation • Financial Position • Cost Reduction
• Profitability • Resource Capacity • Operational Synergy
• Market Trend Non-Financial Analysis • Acquisition Experience
• Regulation • Business Model Synergy Valuation
Competitors • Competitive Advantages M&A Considerations
• Competition Intensity (Resources & Capabilities) • Acquisition Rationale
• Competitor Behavior • Cultural Fit • M&A Strategies (Friendly/
Customers • Quality of Management Hostile Takeover)
• Customer Segment • Right Timing
• Customer Behavior
125
Q2 - Brainstorming
What potential synergies might Travel Tycoon capture
Question 2
by acquiring Price Searcher?
Volume Synergies Direct Costs

• Value Chain Integration: Increasing customer base • Marketing Expenses: Better bargaining power with media
• Market Monopoly Power: Integrating customer data providers, avoiding marketing wars
• Distribution Channels Integration: Increasing customer reach • Sales Expenses: Reducing sales force, sharing of best
• Business Model Integration: Diversifying revenue streams practices
• Information Technology Expenses: Platform and algorithm
Price Synergies consolidation, sharing of best practices
• Margin Pressure over Merchants: Enhancing merchant • Personnel Expenses: Eliminating redundancies
commission charges
• Cross-selling Opportunity: Increasing travelers’ willingness to Indirect Costs
pay • General & Administrative Expenses: Office consolidation
126
What potential synergies might Travel Tycoon capture
Question 2
by acquiring Price Searcher?

Candidates should discuss potential synergies by breaking them down into two aspects, revenue enhancement and cost
reduction, and list out the synergies they may generate
“Through acquisitions, integrating all travel services on the “The marketing expense constitutes the primary cost for the
platform, and optimizing the customer journey of ‘continuous OTA industry, accounting for over 40%. Through acquisitions,
search and price comparison experience’ to effectively economies of scale and scope can be achieved to effectively
increase revenue” reduce costs”
127
Q3 - Math
Question 3 What is the payback period for Travel Tycoon acquiring Price Searcher?
*Please share the following information with the candidate:

• Exhibit 2
• The Investment cost for acquiring Price Searcher is $1.2B
*Please provide this additional information only upon request:

• Profit margin of Travel Tycoon is 20%
• Average order value (AOV) for each booking is $17
• Commission rate for each booking is 15%
• Pay per click (PPC) for Travel Tycoon’s advertisement is $2
• Assuming the changes in profit margin, AOV, commission rate, and PPC after the acquisition can be disregarded for now
128
Q3 - Exhibit 2
Exhibit 2 Travel Tycoon's estimated booking & click changes
Current Annual Bookings Change in Bookings

(count) (%)
Room nights 1,000M +30%
Rental car days 100M +50%
Airline tickets 50M +60%
Restaurant reservations 10M +100%
Current Annual Clicks Change in Clicks

(count) (%)
Advertisement clicks 500M +100%
129
Q3 - Math
The payback period for Travel Tycoon to acquire Price Searcher is 3 years.
Calculations
Increased bookings in different services 1,000M 30% 100M 50% 50M 60% 10M 100% 390M
Increased revenue in agency business 390M $17 15% $1,000M
Increase in advertisement clicks 500M 100% 500M
Increased revenue in meta search business 500M $2 $1,000M
Average annual cash flow ($1,000M $1,000M) 20% $400M
Payback period $1.2B $400M 3 years
130

“Travel Tycoon will be able to payback the acquisition cost of Price Searcher within 3 years.”
Candidates should discuss the increased revenue after the acquisition by breaking it down into two different business
models, agency and meta search, and inquire about all additional information
• Agency: Increased bookings in different services * Average order value (AOV) * Commission rate
• Meta Search: Increase in advertisement clicks * Pay per click (PPC)

• A 3-year payback period and an average annual cash flow of $400M seem to be quite attractive acquisition indicators for
the OTA industry.
• The payback period is highly dependent on the estimated booking & click changes. If the assumptions are overestimated,
this will lead to a significant increase in the payback period.
• Such an attractive payback period may prompt other competitors to vie for acquisitions, thereby intensifying the competitive
intensity in the OTA industry.
131
Q4 - Recommendation
The CEO has just entered the room and asked you to
Question 4
summarize your current recommendations.
Based on the initial assessment, Travel Tycoon should acquire Price Searcher since the payback period for
Solution
the acquisition is 3 years.
• Customers in the OTA industry are mostly price-sensitive, the acquisition can meet their demand for a better
one-stop shop customer experience.
• Revenue synergies can be created by integrating the customer value chain, effectively increasing the
Reason
number of bookings, advertisement clicks, and average order value. Meanwhile, cost synergies can be
created to achieve economies of scale and scope, effectively reducing marketing and sales expenses.
• An average annual cash flow of $400M is a quite attractive acquisition indicator for OTA industry.
However, there are two risks to consider. One is that the financial position of Price Searcher and the cultural fit
Risk after the acquisition may require further confirmation. The other is that The Antitrust Laws may prevent the
acquisition from happening.
As for the next step, I would recommend that Travel Tycoon conduct due diligence on Price Searcher to further
Next Step
understand its assets and liabilities, as well as the quality of its management team.
132
Learn more about
NTU Consulting Club:
https://www.facebook.com/ntuconsulting
https://www.linkedin.com/company/ntu-consulting-club/
https://medium.com/@ntuconsulting
ntuconsulting@gmail.com

National Taiwan University (NTU) Consulting Club Casebook 2024

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

National Taiwan University (NTU) Consulting Club Casebook 2024

Uploaded by

Copyright:

Available Formats

National Taiwan University

(NTU) Consulting Club

1. Gain a comprehensive understanding of case interviews

With warmest regards,

CaseCrackers provide personalized services to empower aspiring candidates

● Graduated from MIT, Columbia, and NYU Stern MBA programs

Empowering individuals to unlock their full potential by providing

Business Case Interview Resume Top MBA

NTU Consulting Club Casebook Committee

1 Introduction to NTU Consulting Club (NTUCC)

2 Consulting Industry Overview

3 Case Interview Introduction and Preparation

Introduction to NTU Consulting Club (NTUCC)

Inspire others, shape the future!

Strategic Thinking Personal Impact Diversity & Global Mindset

Course Project Workshop Career Event

Consulting Industry Overview

Consulting Industry Overview

Why consulting? How to get a consulting offer?

Case Interview Introduction & Preparation

Case Interview Mindset

Structural Thinking (Be MECE)

Be Engaging with the Interviewer

OTA (Online Travel Agency)

Products/Services Financial Factors Key Trends in Industry

● Tier-1 Suppliers: Supply major ● B2C Consumers

Products/Services Financial Factors Key Trends in Industry

Products/Services Financial Factors Key Trends in Industry

● Infrastructure provider (e.g. ● B2C Consumers

Products/Services Financial Factors Key Trends in Industry

FMCG (Fast Moving Consumer Goods)

● Raw Material Suppliers

Products/Services Financial Factors Key Trends in Industry

Products/Services Financial Factors Key Trends in Industry

● Medical Device Providers

Products/Services Financial Factors Key Trends in Industry

● Low Expenditure: Taiwan's healthcare

NHI1: National Health Insurance 全民健康保險 18

● Aircraft Manufacturers (Airbus,

Products/Services Financial Factors Key Trends in Industry

● Investment Trends: High capital

● HCP (Healthcare Professional),

Products/Services Financial Factors Key Trends in Industry

● Duration & Success Rate:

Products/Services Financial Factors Key Trends in Industry

● Introducing New Technology

● Raw Material Suppliers ● B2C

Products/Services Financial Factors Key Trends in Industry

● Machinery and Equipment ● Automation & Robotics

Private Equity / Investment

● Private Investors ● Institutional Investors

Products/Services Financial Factors Key Trends in Industry

Name Industry Level Qual* Quan Chart Page

ABC Co. Retail Medium Medium Easy 25

Tech Innovations Inc. Technology Easy Easy Easy 39

AEC Co. E-commerce Easy Easy Easy 51

Tastea Retail Medium Medium Medium 61

Weight-Loss Injection Healthcare Easy Easy Easy 72

Enigma Smartphone Technology Medium Easy Medium 80

Rapid Co. Automotive Medium Easy Medium 92

Inu group Retail Medium Medium Easy 107

Travel Tycoon OTA Hard Hard Medium 120

Case 1 – ABC Co.

Additional Information (If asked) Interviewer Guidance