Mock Case Interview at Bain & Company | Full Example with Feedback — Transcript
Full transcript
- 0:00[Music]
- 0:05what's a case interview like how should
- 0:07you interact with their interviewer how
- 0:09long should a case interview take these
- 0:11are some of the questions that we get as
- 0:12people are preparing for their case
- 0:13interviews with Bay in this video you'll
- 0:16get a chance to see someone set up their
- 0:18analysis and their framework work
- 0:20through their analysis including doing
- 0:21some math and synthesize their
- 0:23recommendation at the end we hope this
- 0:25interview example helps you feel
- 0:27prepared and confident heading into your
- 0:28interviews so let's take a look at a cas
- 0:31interview hi Eric great to meet you
- 0:33great to meet you so glad to have you
- 0:34here today excited to be here a little
- 0:36nervous but excited yeah how are you
- 0:38doing just more generally I'm good I'm
- 0:40good yeah office is beautiful
- 0:41everybody's been great so far and just
- 0:43yeah excited to get going with the case
- 0:44I'm so glad well I'll be the one pushing
- 0:46us along don't worry if I finish us up
- 0:49move us to another area I'll be in
- 0:51charge in terms of the time management
- 0:53good to know thank you great so should
- 0:54we jump in yeah let's do it all right so
- 0:56let me give you a little bit of the
- 0:57context of the case now one thing I love
- 1:00about this one is I do all consumer
- 1:03products and Retail work for you know my
- 1:05normal job here at ban and so this is
- 1:08one of those consumer products types of
- 1:10cases and it's based off of a real Bane
- 1:12case okay and so let me give you a
- 1:14little bit of the situation we're going
- 1:15to Blind all of the company names for
- 1:17the purposes of
- 1:18confidentiality so our client is foodco
- 1:21they're a multi-billion dollar client
- 1:24that has leading Brands across many
- 1:26different food categories right now
- 1:28they've narrowed in on the alternative
- 1:29milk category they believe it's growing
- 1:32quickly has some attractive elements to
- 1:34it and alternative milk you can Define
- 1:36as anything that's non-dairy plant-based
- 1:39so things like almond oat coconut soy
- 1:42you name it all goes within alternative
- 1:45milk I think I used almond in my latte
- 1:46this morning so there you go so you're
- 1:48you're familiar already they've
- 1:51partnered with Bane to determine how
- 1:53they want to enter and whether or not
- 1:55they think this asset is the right way
- 1:56to enter the space okay because they're
- 1:59pretty familiar with this Market they've
- 2:00narrowed in on a Target named smilk and
- 2:03smilk in terms of its profile it's
- 2:06pretty attractive profile that's why
- 2:07they're interested in it okay to give
- 2:09you some facts on it it has over the
- 2:11past three years been doubling its
- 2:13profit each year oh wow it's impressive
- 2:16very very strong performance overall it
- 2:18has about 6% share of the alternative
- 2:21milk market and um is expected to grow
- 2:24to 8% okay so moderate modest growth
- 2:27right now this smk has been able to
- 2:30expand across Europe and the us but
- 2:33foodco for this particular piece of work
- 2:36is only interested in the US market okay
- 2:39good to know so we'll be focusing on
- 2:40that now here's the real complicating
- 2:43element of it they expect that smk
- 2:45should be able to increase its profit by
- 2:486X over the next 5 years okay so as we
- 2:51think about this overall I'd love to
- 2:53have you tell me a little bit about how
- 2:55you would approach assessing this
- 2:57question and in particular we need need
- 2:59to understand whether or not this 6X
- 3:02profitability growth is feasible okay
- 3:04great I think I understand the situation
- 3:06can I ask a couple clarifying questions
- 3:08sure absolutely awesome I imagine they
- 3:10have different business units like Al
- 3:12men soy oat any gaps in their portfolio
- 3:15that should be aware of not that it's
- 3:17relevant to the case currently gotcha
- 3:19and then finally just in terms of
- 3:23understanding does spco have any other
- 3:25specific acquisition thesis that I
- 3:27should be aware of any metrics that they
- 3:28want to hit or is just broad assessment
- 3:31get our opinion whether it's good or not
- 3:33you know that's a good question so
- 3:35mostly they're focused on whether or not
- 3:36they can achieve the profit okay but
- 3:39what's equally important is thinking
- 3:41about share and the trade-offs between
- 3:43the two of those okay awesome I think I
- 3:46understand the problem excited to get
- 3:47into it you might have to take a couple
- 3:48moments to structure my
- 3:58thoughts
- 4:03awesome so as I think through this
- 4:05problem of how to assess uh smilk from
- 4:08food Coast perspective and think through
- 4:10whether the profitability target is
- 4:12achievable there's really three buckets
- 4:14that I want to look into first is the
- 4:17alt uh milk Market itself great second
- 4:20is a deep dive into smilk and their
- 4:22internal operations perfect and then
- 4:24finally I have some other considerations
- 4:25and RIS that I want to look at Great
- 4:27before we jump into your framework can
- 4:29you tell me why you thought about these
- 4:30three as being the main buckets that you
- 4:32wanted to focus on for sure so I wanted
- 4:34to first start looking at the market
- 4:36because I think a core tenant of any
- 4:39good acquisition or investment is that
- 4:41the asset is positioned in a market that
- 4:43is favorable growing has Tailwinds and
- 4:46headwinds Etc then once we feel
- 4:49comfortable about that that's a large
- 4:51and growing Market smilk is well
- 4:52positioned within it making sure that
- 4:54smilk has everything that they need to
- 4:57to be able to succeed capture share grow
- 5:00Revenue decrease costs which will
- 5:02ultimately help us to improve
- 5:03profitability great and then finally
- 5:06these like other risks are
- 5:07considerations are more kind of deal
- 5:09specific in terms of you know how might
- 5:12we Finance it uh what is the balance
- 5:14sheet of Food Co look like can they
- 5:16bring on debt um because I think that
- 5:18will impact what the ROI could look like
- 5:20moving forward in terms of opportunity
- 5:23cost I know that there's zero datea on
- 5:25smilk right now but are there perhaps
- 5:27other ways that they could enter the
- 5:28market um should they do a joint venture
- 5:31with somebody should they just build it
- 5:32organically themselves or could there be
- 5:34a better Target and then finally with
- 5:36any acquisition I think making sure that
- 5:38we don't lose sight of culture to make
- 5:40sure that it'll fold in nicely and that
- 5:42that transition plan would go smoothly
- 5:44but unless there's any other questions
- 5:46on kind of how I've I've thought through
- 5:47this I think I want to start with the
- 5:49initial hypothesis that yes this asset
- 5:52would be a good acquisition for uh food
- 5:55Cod to make and that they will be able
- 5:57to achieve the The Profit Target
- 6:00of just remind myself 6X in in the next
- 6:035 years MH and so in order to start
- 6:04testing that we' really start to like
- 6:06looking at this first bucket in terms of
- 6:09what the overall alternative milk Market
- 6:11looks like and ideally Broken Out by
- 6:13segment perfect is that where you'd like
- 6:15to start yes it would be great and then
- 6:16after we look at that what are the most
- 6:18important elements within smilk So
- 6:20within smilk what I would love to
- 6:22understand is looking at their
- 6:25historical performance broken out
- 6:27ideally by business unit um the reason I
- 6:29want to look at that is to get a sense
- 6:32of how they've gotten to where they are
- 6:33today I know that they have doubled
- 6:36profit every year for the past three
- 6:37years which is really incredible growth
- 6:39right and obviously there's multiple
- 6:40ways that they could do that they could
- 6:42be gaining market share they could be
- 6:44introducing new products or they could
- 6:46be cutting cost or some combination of
- 6:48all of that and I think how they've
- 6:50gotten to where they are today will give
- 6:52us a good insight into what future
- 6:54growth opportunities they might have and
- 6:55help us to get a really good
- 6:56understanding of whether or not that 6X
- 6:58Target is achievable fantastic I like
- 7:00how you're thinking about it I also like
- 7:01how you're bringing it back to the
- 7:03objective around this 6X so let's start
- 7:05where you suggested okay and I have a
- 7:07slide here that gives you a picture of
- 7:09the market I would love for you to tell
- 7:11me what does this tell you about the
- 7:13Dynamics of the milk Market okay if I
- 7:16can just take a couple moments to orient
- 7:19myself so what I'm seeing is a chart of
- 7:24kind of the US milk sales over the past
- 7:2710 years forecasted uh into the future
- 7:29for 5 years from now and the first thing
- 7:31that immediately jumps out to me is you
- 7:33can see that the overall Market has been
- 7:35in Decline and forcasted going forward
- 7:38it's at best going to remain roughly
- 7:41flat that's right so from the overall
- 7:43perspective not great but what is
- 7:45exciting for smilk is when you do a deep
- 7:47dive into the alternative milk segment
- 7:49that is actually expected to grow and
- 7:52and quite considerably over the next 5
- 7:54years a low double digit ker is actually
- 7:56pretty exciting to me and so feeling
- 7:59feeling good about that and looking
- 8:01closer at the data row I'm seeing some
- 8:03numbers that we can manipulate in order
- 8:06to get a sense of exactly what the size
- 8:08of the alt milk Market is today and then
- 8:10what it's going to grow to five years
- 8:12from now which I think will be a good
- 8:13starting point to help us understand the
- 8:15feasibility of the 6X Target agree let's
- 8:17go ahead and do that okay so uh in order
- 8:20to combine these variables I'm thinking
- 8:21we first take the alt milk share uh
- 8:24today multiply that by the overall
- 8:26Market size which will give us the alt
- 8:27milk Market uh in dollar today and 5
- 8:30years from now putting some numbers 19
- 8:34billion is okay if I round that yes 19
- 8:36billion times
- 8:3911% that is roughly 2 billion 2.1
- 8:45billion so that is today and then in 5
- 8:50years we are going to uh
- 8:5419.2 billion time
- 8:5720% Which is 3
- 8:59.8 billion but I'm going to go ahead and
- 9:02round that to 4 billion so like I said
- 9:06um we now have a better sense of what
- 9:08might be achievable if schil just kind
- 9:09of maintains market share maintains
- 9:11status quo going forward it's exciting
- 9:13it's 2x um but it is a far cry from
- 9:17their 6X Target and so to update my
- 9:20hypothesis I still think that there is
- 9:22reason to believe that this would be a
- 9:24good acquisition for foodco however I'm
- 9:27more bearish about the achievability of
- 9:29the 6X profit Target in order to get a
- 9:31better sense of that achievability I
- 9:34would love to look at any internal
- 9:37financials that we have from smoke to
- 9:38see how they've grown over the past I'm
- 9:40so glad that you asked and and had us go
- 9:43there because I'd love to think a little
- 9:44bit about the feasibility of this share
- 9:46gain now that we've isolated that they
- 9:48will need to gain share to reach their
- 9:50targets potentially or other levers I'd
- 9:53love you to tell me a little bit about
- 9:54what this competitor Market view tells
- 9:57you about their ability to gain share
- 10:00okay just orienting myself quickly so
- 10:04what I'm seeing like right off the bat
- 10:07is not too long ago only a year and a
- 10:10half um there weren't that many players
- 10:12and smilk was still very ncent but over
- 10:16time smilk has moderately grown its
- 10:19market share seems like they've
- 10:21plateaued very recently and they are the
- 10:24smallest player in an ever increasing
- 10:26competitive and crowded Market correct
- 10:28and and then just interpreting uh the
- 10:31names here large snackco looks like the
- 10:33market leader which could potentially be
- 10:36not great for smoke if they're going up
- 10:38against somebody that is very well
- 10:40financed uh and very entrenched in the
- 10:43market and so uh from looking at this
- 10:47I'm feeling even better about the view
- 10:50that the 6X uh profit might not be
- 10:53achievable simply because I don't see an
- 10:57easy win here in order to gain share
- 11:00however I'm not going to give up um I
- 11:02think some things that could help them
- 11:04achieve that if any of these competitors
- 11:06are potentially acquisition targets and
- 11:08food co could do a quasi like roll up
- 11:11strategy that's great that could be a
- 11:13way um but uh what else would you need
- 11:16to know about smilk to gain confidence
- 11:19that they could gain share I think in
- 11:21order to to gain confidence about how
- 11:23they could gain share I want to know a
- 11:25couple of things one is I guess I would
- 11:29bucket this kind of external and
- 11:31internal um considerations externally I
- 11:34would love to know how customers view
- 11:36them are they differentiated in any way
- 11:39from a product standpoint or a
- 11:40capability standpoint such that they
- 11:42could steal share and then second um
- 11:45from the internal perspective I would
- 11:48love to know what products they offer
- 11:50today are there any untapped geographies
- 11:53that they're not in for example are
- 11:55there any products that competitors
- 11:56offer that they simply lack and then I
- 11:59know we're focusing on grocery but
- 12:00there's always opportunity for
- 12:02partnership there's always opportunity
- 12:03for um you know selling your brand
- 12:06outside of grocery stores like coffee
- 12:07shops um you know airport lounges Etc so
- 12:11that's great so to update my hypothesis
- 12:14I still think that this is a good asset
- 12:16so I feel good about um the acquisition
- 12:19thesis there however I'm increasingly
- 12:21bearish on the ability to hit that 6X uh
- 12:24rep or profitability increase over the
- 12:26next 5 years in order to feel more
- 12:29comfortable about that part I would love
- 12:32to look internally to smoke in terms of
- 12:35their financials to understand how
- 12:37they've grown and like you just
- 12:38suggested are there any opportunities
- 12:40that they could uh kind of untap
- 12:42potential to steal share that's great I
- 12:44think we're going to explore both the
- 12:46internal and the external that you
- 12:47mentioned so first let's go to the
- 12:49internal I have some data on the company
- 12:52okay could you first Orient me to what
- 12:54you see in terms of the data you do have
- 12:56and what you would need in order to
- 12:58answer this Sixx profit question so what
- 13:01I'm seeing like you said we have
- 13:03financial data for smilk broken out uh
- 13:06from their us business and their
- 13:08European business and looks like it's a
- 13:10little bit of a puzzle to solve in terms
- 13:13of uh some some blanks that we need to
- 13:14fill in love some logic games yeah love
- 13:17love some logic games and so what I'm
- 13:19seeing in terms of how to well just to
- 13:21react like very quickly to this it's
- 13:24interesting that the US business is only
- 13:27uh a quarter of overall profit
- 13:28profitability compared to the European
- 13:30business which is observation which is
- 13:32important because we're only focused on
- 13:33the US from food Coast perspective the
- 13:36second thing that sticks out to me is
- 13:38there's quite a a delta in terms of the
- 13:40margin between the two geographies and
- 13:43so you know to keep this on our radar
- 13:46moving forward would' love to understand
- 13:47why that Delta exists and if there's any
- 13:50way that we could potentially bring the
- 13:51US business up to up to Snuff with what
- 13:53they're seeing in Europe but to get to
- 13:55your question in terms of how to fill
- 13:58this chart out out what I'm seeing is we
- 14:01have Revenue today and we have the
- 14:03margin so we can back solve for this
- 14:06profit figure right here and then we
- 14:09know in the US what the market size is
- 14:11today we know what their share is so
- 14:13that'll give us this value and then same
- 14:16approach knowing the margin we can back
- 14:18calculate what profit is that'll leave
- 14:21this hole and then we can kind of fill
- 14:22in from there now before we do that
- 14:25going through that process what is it
- 14:27going to tell you about whether or not
- 14:29they can achieve that 6X profitability
- 14:31so what it's going to tell me is it's
- 14:32going to tell me what profit is today
- 14:35and then we know what profit is today we
- 14:38know what the market is expected to be 5
- 14:40years from now what their market share
- 14:42is expected so that'll give us Revenue
- 14:45right then if we multiply by a margin
- 14:47that'll give us what if everything goes
- 14:49as we're forecasting no changes in
- 14:51margin what profitability would be right
- 14:53just looking at these numbers if we do
- 14:56that like we said from before with no
- 14:58material change and share they're only
- 15:00expected to gain two points that's not
- 15:02going to close the gap unless we see
- 15:03some sort of margin increase like that's
- 15:06also not going to close the gap but I do
- 15:09think that there are still ways that we
- 15:12could achieve this one would be if we
- 15:14could increase the profitability of the
- 15:17US segment to get to Europe that'll get
- 15:19us some of the way my intuition is not
- 15:20going to get us all the way but there
- 15:23also could be some margin Improvement
- 15:25that you would see from synergies
- 15:26rolling into Food Co I would expect that
- 15:28distribution Logistics Etc would get
- 15:30cheaper also purchasing power of a
- 15:33really large company could help get the
- 15:35cost of goods down for these different
- 15:37types of milks materials Plastics
- 15:40Etc um and so I'm kind of imagining a
- 15:45sensitivity Table to where if like if we
- 15:49know what the market would need to would
- 15:52look like in the future there's some
- 15:54implied share that they would have to
- 15:55get to assuming profitability Remains
- 15:57the Same and and then vice versa if we
- 15:59assume no share gain but uh calculate
- 16:03what profitability the margin would need
- 16:05to increase to hit the target that'll
- 16:07help us understand the extremes of the
- 16:09sensitivity table and then help us get a
- 16:11better sense of could reality exist
- 16:13somewhere in the middle great and bound
- 16:15the potential outcomes I really like how
- 16:17you're thinking about this especially
- 16:18because there's a lot of things that
- 16:20could go right to reduce costs overall
- 16:22and help them hit their margin targets
- 16:24how are you thinking about the
- 16:25trade-offs though some of the headwinds
- 16:27they might face great fall out there are
- 16:29natural tensions between trying to
- 16:31increase market share and thus increase
- 16:33Revenue as well at the same time as
- 16:35trying to decrease costs on one hand you
- 16:39usually need to invest for growth but on
- 16:41the latter situation of trying to
- 16:43improve profitability that often times
- 16:45comes with finding places to get better
- 16:49more optimized with your budget and
- 16:50maybe requires less investment um just
- 16:53to protect that that margin yeah so glad
- 16:55you're acknowledging that why don't we
- 16:56go ahead and do the exercise us
- 16:58suggested so that we can really get our
- 17:00arms around what the real potential
- 17:02might be to increase profit is it okay
- 17:04if I just write on please do so um
- 17:08revenue is 320 million profit margin is
- 17:1015% so to arrive at this profit figure
- 17:13is just 320 million time 15% and that
- 17:16will give us the dollar value so 10% of
- 17:19320 is 32 half of that is 16 which means
- 17:22that this is 48 million great um what I
- 17:27said earlier for the US business we know
- 17:30that the market is 2 billion today and
- 17:34they have six% share so that is 120
- 17:41million which means 320 - 120 is 200
- 17:48million we know that if this is 10% um
- 17:5110% of 120 is 12 and then 18% of 200
- 17:58is 36 million which checks because 12 +
- 18:0236 is 48 so now that we have all of this
- 18:05mapped out we can put some specific
- 18:08numbers to what their actual profit
- 18:09Target is great and so if they are
- 18:12at 12 million
- 18:16today and they need to 6X that means
- 18:19they need to get to 72 million mhm and
- 18:23so like I was saying in terms of
- 18:25understanding how they might get there
- 18:27we know that that there's going to be
- 18:29some latent growth assuming they hit
- 18:32their market share targets and the
- 18:33market grows like we expected right so I
- 18:35can figure out what that contribution
- 18:36would be and then the Delta would
- 18:38essentially come from the sensitivity
- 18:41table that I outlined that's plan great
- 18:43okay let's go ahead and do it so um we
- 18:45know that go ahead and transfer over
- 18:48here Market 5 years from now is going to
- 18:52be 4 billion and they're going to have
- 18:568% share
- 18:59which translates
- 19:01to $320 million in in revenue and then
- 19:07so just from that if they keep the 10%
- 19:12profitability margin that means that
- 19:14they are getting to 32 million so that's
- 19:17good like we we've already talked about
- 19:19but it is still cry $40 million short we
- 19:23we need to more than double this and so
- 19:25that let's go find how we might do that
- 19:27and so from the revenue marketshare
- 19:31perspective uh and then looking at it
- 19:33from the
- 19:35profitability
- 19:39perspective so when I look at how much
- 19:44they would need to achieve we'll we'll
- 19:46solve backwards here so we know that
- 19:48they need 72 million if we are going to
- 19:51assume the 10% profitability mhm that's
- 19:56simple math we know that they need to to
- 19:58grow um to $720 million of Revenue right
- 20:03at that profit level at that profit
- 20:05level that seems like quite a bit um if
- 20:08we go ahead and figure out what that
- 20:10implied market share would be uh very
- 20:13quickly so we know it's a
- 20:174072 so that would be
- 20:20one 4 3 2 18
- 20:2518% market share MH
- 20:28which is triple from what they are at
- 20:31today um which is a lot to gain
- 20:33especially since they plateaued out over
- 20:35time did so again I think we're going to
- 20:37need to dip into this profitability
- 20:39perspective yes and so where I'm
- 20:41thinking about here is we'll assume that
- 20:44they maintain share uh that we're
- 20:46forecasting of 8% so we know that
- 20:48they'll be starting with
- 20:49$320 million of Topline mhm again we're
- 20:53trying to solve for this 72 million and
- 20:56so now it is just figuring out what the
- 20:58margin is and if I do this it looks like
- 21:04it is just higher than
- 21:0920% but to put some math to
- 21:14it
- 21:1622 2 64 and that leaves us eight
- 21:22so it's like 22 to 23% great so 23%
- 21:29again that's big but if we look at the
- 21:31European business as potentially where
- 21:33we might get to so upper bounds 18% call
- 21:37it 20 maybe if we get some synergies
- 21:39from foodco I think we need to do some
- 21:40further analysis to see if we can unlock
- 21:43fully unlock this 23% but I'm now
- 21:46getting a little less bearish than I was
- 21:48originally so I'm going to update my
- 21:49hypothesis that this is a good asset I
- 21:52like the market that they're in um I
- 21:54like the growth potential from the
- 21:57profitability perspective perspective
- 21:58the the lever that exists particularly
- 22:00here in terms of matching the European
- 22:01business um and I think a combination of
- 22:04these two could make the 6X profit uh
- 22:07Target achievable we might not get all
- 22:09the way there but I think we might get
- 22:11pretty close which I think would be
- 22:12exciting to Fuko right could still make
- 22:14it attractive and and I like your
- 22:16sensitivity because you know you don't
- 22:17need it to be on either end of these
- 22:19extremes but we are asking for a lot to
- 22:21go right share gain and margin so why
- 22:24don't we take a look at some of the
- 22:25external factors that you had mentioned
- 22:28um so I'd love you to take a look at
- 22:29this and tell me what it it tells you
- 22:31about the competitive market okay so
- 22:34there's a lot of information here if I
- 22:36could just Orient myself quickly so what
- 22:40I'm seeing is smil compared to um looks
- 22:43like a lot of the major players from
- 22:45this early market share map that we
- 22:47looked at earlier and what I'm seeing is
- 22:49first validating that you know smilk is
- 22:52that where they are today they a smaller
- 22:53player in the market and then you know
- 22:56alt milk 5 and large snackco are kind of
- 22:58the Behemoth right which it's exciting
- 23:00that in the last 18 months they've been
- 23:01able to do this again I think points to
- 23:04the attractiveness of this Market but
- 23:06also paints a potentially negative light
- 23:08from the competitive landscape I love
- 23:10seeing for smilk some of the word
- 23:12associations here fun delicious premium
- 23:15like that sounds like a really good
- 23:16brand that could be you know kind of the
- 23:19core tenants and assets that we could
- 23:20leverage for for future growth again
- 23:23this High customer satisfaction I think
- 23:25is only solidifying that this might be
- 23:28bad right now the fact that customer
- 23:30awareness is low but if we're starting
- 23:32from a low base I think there's
- 23:33opportunity that we could use to
- 23:35increase um that going forward which
- 23:37would help us increase sales help us
- 23:39improve the market share that we have
- 23:42and then the pricing difference is quite
- 23:45interesting as well it looks like we're
- 23:47roughly kind of middle of the road
- 23:50whereas you know there might be some
- 23:52upward Potential from pricing that we
- 23:55see um you know alt milk has gained a
- 23:57ton of share yes people do view it as
- 24:00overpriced but um you know there might
- 24:03maybe we don't go all the way to $6 but
- 24:05it I think there might be some room
- 24:07especially because we're seeing as
- 24:08premium and that's not a word
- 24:10association I see here so maybe the
- 24:11willingness to pay for a premium product
- 24:14should be there and so again I think
- 24:17going back to the math that we just did
- 24:18in terms of how to steal market share
- 24:21this could be an Avenue and pricing is
- 24:23really exciting because it is a lever
- 24:25that is not intention it flows to the
- 24:28bottom line and so um with this again
- 24:31hypothesis I feel even better about this
- 24:33asset after seeing this table and I also
- 24:35feel a little bit better about the
- 24:36profitability target do we have
- 24:38information on customers willingness to
- 24:40pay or the potential to run a pilot in
- 24:42terms of to get some data of How High we
- 24:44could take prices without damaging
- 24:46volume that's a great question
- 24:48absolutely something that we would do
- 24:49and did do Under the course of this but
- 24:52one thing that I you know would love to
- 24:53know quickly is as we think about
- 24:55deepening our insights and analysis for
- 24:58Food Co and we know that they are
- 25:00fantastic in terms of building platforms
- 25:02and acquiring and I think it was a
- 25:04comment that you made earlier as well
- 25:05that they could start to think about
- 25:07that where do you think that they could
- 25:09go here in terms of their their overall
- 25:11portfolio yeah so I I think it was one
- 25:14of the when we were looking at the
- 25:15market share map like potentially a
- 25:17quasi rollup uh strategy and if I if I
- 25:19go back to the math that we calculated
- 25:21earlier 18% total market share would
- 25:23help him get to that Top Line and
- 25:25looking at this um you know alt milk one
- 25:29adding on would help us get there and
- 25:30then these other three targets if we
- 25:33were to uh incorporate them into food
- 25:35Coast portfolio that would help us to
- 25:37reach the Target and exceed it obviously
- 25:40becomes the question of are they viable
- 25:42are they up for sale um and again all of
- 25:44the other considerations that we
- 25:45outlined in the original framework of
- 25:47like culture um how we would Finance it
- 25:49Etc come com to mind and if they are you
- 25:52know adding to their profit profile
- 25:55overall that great point cuz we don't
- 25:58know what the the profitability of these
- 25:59companies look like 20% share gain in
- 26:01the last 18 months I imagine that came
- 26:03with quite a bit investment and maybe
- 26:04their margins look very negative very
- 26:06likely well this has been fantastic I'd
- 26:09love to take a step back and and just
- 26:11ask you at this point knowing we don't
- 26:13have all the information that we
- 26:14typically would have where where is your
- 26:16recommendation and your hypothesis at
- 26:18this point my recommendation to foodco
- 26:20is that they acquire smk for the
- 26:22following reasons one I think the
- 26:24alternative milk Market segment is
- 26:26exciting expected to double over the
- 26:28next 5 years and second I think smilk in
- 26:30terms of the assets that it is bringing
- 26:32is a great platform to be able to grow
- 26:36and get close to the 6X profitability
- 26:39Target customers love it it's seen as a
- 26:41premium brand and there's a lot of
- 26:42potential that we could tap into there
- 26:44especially if we consider synergies that
- 26:46food co will bring however this
- 26:48recommendation is not without risk like
- 26:51I alluded to the 6X profitability Target
- 26:53is quite ambitious we've run the numbers
- 26:56and there's going to need to be both
- 26:58Market um share gain as well as
- 27:01improving profitability in order to hit
- 27:04that Target but understanding we might
- 27:06not get all the way there I would love
- 27:08to for next steps start looking into
- 27:11different pricing strategies that we
- 27:13could employ uh in order to prove
- 27:15Revenue improve market share moving
- 27:17forward and then there's always the uh
- 27:20ability to negotiate with smilk on the
- 27:22acquisition price understanding that
- 27:23their expectations might not be grounded
- 27:25fully in reality that's fantastic I'm I
- 27:28your rationale makes so much sense and
- 27:30I'm so glad that you've highlighted some
- 27:32of the key considerations and risks
- 27:34especially around pricing because to
- 27:36give you a little bit of insight this
- 27:38project was based off of a real case and
- 27:41there wasn't a willingness to pay that
- 27:42higher price so made that profit Target
- 27:44even more tricky but you you absolutely
- 27:47targeted the right next steps here for
- 27:50this project awesome so very nicely done
- 27:53and it was wonderful to meet you yeah
- 27:54thank you for working through the cas me
- 27:55take care I hope this video is giving
- 27:57you valuable insights into the mindset
- 27:59the preparation and the approach you can
- 28:00take to case interviews I'd also
- 28:02encourage you to take advantage of the
- 28:03tips and tricks video that you can find
- 28:05on our YouTube channel or our website
- 28:07and there's a lot of other resources at
- 28:08bane.com careers to help you prepare for
- 28:11a successful interview
- 28:12[Music]
- 28:16process
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