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Case on Framework Structure - Market Entry

Case Interview Framework market entry MECE problems
New answer 3 hours ago
2 Answers
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Anonymous A asked 14 hours ago

Case is from Bain Website for friend to enter the coffee shop Industry in Cambridge, what to consider before go or no go…

My Buckets:

 

1) Coffee Shop market :

a) Growth Rates / Size

b) Competition 

c) Customers (preferences, what they like, etc.)

 

2) Financials (predicted rev, cost, investment)

 

3) Capabailities (her experience, why she is suited to open this)

 

4) Risks (financial and other)

 

I have been told that Competition should always be its on bucket - surely not it is part of the market though? Same with also Customers? 

If someone could explain would really appreciate it - this has really been confusing me.

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Best answer
Tiago
Expert
replied 12 hours ago
ex-BCG Consultant & Interviewer | +150 interviews | Tackle any case w/o memorizing frameworks | Harvard MBA

Hi,

I think you should split them into 1. Coffee Shop Consumers and 2. Coffee Shop Competition, because of the importance of each block independently in this case. However, I want to highlight that I don't joining them is a no-go - you could probably get away with your joint structure in a real interview, as long as you were able to clearly justify your reasoning and identify the key questions you want to answer.

Let me materialize why I would split them by showing the questions I would ask inside each dimension:

  1. Coffee Shop Consumers: what is the overall market size and growth, what are the key trends in this sector, what is my target audience (only students, or other people as well), what are their preferences/demographics/habits, what is their willingness to pay
  2. Coffee Shop Competition: who are my direct (other coffee shops) and indirect (other venues like brunch places, etc.), what is their size (multinational or local players - important to measure their firepower reacting to a new entrant like our friend) what are they offering to my target audience and how (loyalty programs?), what is the satisfaction of consumers with our competitors (e.g., google ratings), what is their price point, how strong is their brand (starbucks is difficult to compete with)

In summary: as a rule of thumb, if you the bucket is very large (meaning, having many questions you want to answer), consider spliting. If not, leave them together. There's no right or wrong as long as you can clearly justify your rationale.

Best,

Tiago

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Oliver
Expert
replied 3 hours ago
Former BCG interviewer (75+ interviews for associates, consultants and MBA hires) | I will make your practice perfect

Hi,

I haven't encountered this case before, but I think your framework can work well with some refinements. It's crucial, especially in this scenario, to tailor your framework specifically to the case at hand. The current structure appears a bit generic.

For instance, assuming the case involves an individual opening a coffee shop in Cambridge, the focus shouldn't be on the overall market size and growth rates of the UK coffee shop industry. Instead, the assessment should revolve around the individual's ability to:

a. Attract existing coffee consumers to choose their shop over local competitors.

b. Convert non-coffee consumers into customers.

Therefore, emphasize understanding local consumer preferences, purchasing behaviors, how competitors are meeting these preferences, and how this individual plans to cater to these specific consumers.

Best regards,

Oliver

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