Toothbrush Company - MyConsultingCoach

Allow the interviewee to come up with a case structure. The key would be to do a segment wise profitability analysis and comparison. 

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Wait for him to come up with the key metric on the basis of which he would do the comparison. In case he struggles, prompt him to use a ‘per customer per year’ metric.

Below would be the steps to solve the case:

1. Segment wise profitability analysis

Allow the interviewee to drive this analysis by asking for relevant information. If the interviewee is struggling, prompt him to think of the different factors – usage, profitability of each product etc.  The interviewee should enquire about the segment information. A great interviewee would also ask about the market share change in order to understand whether the share gain of battery operated segment came at the cost of electric toothbrush or manual toothbrush.

2. Segment-wise profitability calculation

The interviewee can now use the information shared to calculate the profit per customer per year for each of the product segments

In order to calculate the profit/customer/year, the interviewee would need to calculate:

1. Profit per sale
2. No of sales per customer per year

The product of profit per sale and sales per customer per year, will give us the profit/customer/year

We can use the below formulae to calculate the key metrics: