Car Service Company
Case Statement:
Your client is a premium car service provider deciding whether to enter the Indian market. Should they enter the market and if yes how should they do so?
C: Is there any reason for choosing India as the market to enter?
I:India is an emerging market, and the competition is fragmented.
C: Can you tell me something more about the client and how it operates?
I:Yes, the client is a premium car service provider in the west who provides end to end one stop solution.
C:Can you tell me something about the other players in the industry?
I: All other competitors are small local players or service providers from the car brands itself.
C:Is it fair here to assume we will be targeting premium customers only keeping in line with the model in which we operated in the west
I: That is a fair assumption.
C: As we are planning to enter the country is there any particular city, we are planning to launch the service in initially?
I:Good question, we are planning to enter only Delhi in the initial phase.
C: Is there any time period we are looking to break even
I: We are planning to break even in the first three years.
C: I want to look at two main things before I decide whether entering the market now makes sense the market scenario and how the company is structured now. Is there anything you want me to focus now or shall I go sequentially. First, I would like to estimate the potential market size. Do we have any information on the same or should I estimate it?
I:. Yes lets go ahead with the approximate estimation. Tell me how you will go ahead with the approximating no of cars present in Delhi by 2031.
C: Starts with estimation based on no of families in Delhi and income-based segmentation followed by number of cars per family in each income bucket.
I: That’s a good approach can you think of any other approach.
C: I can estimate it based on number of cars sold per day. I would estimate no of car showrooms in delhi * average number of cars sold per showroom currently * life expectancy of a typical car (assumed to be 10 after confirming with interviewer)
I: Are u missing something.
C:Yes, I should also account for the growth rate.
I:Assume there are 10 Lakh cars in Delhi now (2021) and the growth rate expected is 10% how many cars will be there in Delhi by 2031. Tell me an approximate number in 50 seconds.
C:1.1^10, which should be around 25 lakhs in 10 years.
I: Ok let's continue with the case, quickly tell me what all will u check.
C: Now that we have looked at the market size and market growth, I would also like to look at the market share we can expect to capture, who all are the market stakeholders and any potential risks. Shall I deep dive into this.
I: Let’s assume that there are no other external threats, what all other things you will investigate.
C: Financial and Operational constraints of setting the shop in India
I: Ok I think you have captured all the points well, lets end the case here.
Background Information:
Ttimeline to break even : 3 Years
Company details: Premium car service provider in the west provides end to end service solutions
Product: One stop solution for all car related needs.
Location: Planning to enter Delhi first
Competitors: Local competitors or car manufacturers providing service
Case recommendations:
Remain calm and have good mathematical ability in calculating numbers fast.
Structuring and evaluating small aspects of the case which might be missed out.