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Unit economics of a food delivery app in India

You run the case. Read the prompt, answer questions from the notes below, and share data only when the candidate asks for it or gets stuck. Score at the end.

Case timer

00:00

Target length:

1. Read the prompt aloud

Read it slowly, then pause. Let the candidate ask questions before they structure.

A food delivery app in India takes a 25 percent commission on an average order of INR 400. For each order it pays INR 45 to the rider, INR 8 in payment fees, and INR 7 for customer support. A new customer costs INR 300 in marketing to win, orders 3 times a month, and stays 8 months on average. Is a customer worth winning?

2. Answers to clarifying questions

This case has no scripted clarifying answers. Answer from the prompt, and say "assume what you think is reasonable" if the prompt does not cover it.

3. A model structure

Compare the candidate's structure with this one. A different split can be just as good if it is clean and fits the problem.

LTV compared with CAC
- Contribution per order = commission minus variable costs per order
- LTV = contribution per order x orders per month x months retained
- Compare LTV with CAC of INR 300

4. The working, step by step

Each step shows how a strong candidate works it out. Share a new fact from it only when the candidate asks or is stuck, and let them do the math: the result in the dark box is what they should reach.

Step 1: Revenue per order
What a strong candidate does: The app keeps 25 percent of the order value.
Commission per order (INR): 400 × 0.25 = 100
Step 2: Contribution per order
What a strong candidate does: Subtract rider, payment, and support costs.
Contribution per order (INR): 100 - 45 - 8 - 7 = 40
Step 3: Lifetime value
What a strong candidate does: 40 per order, 3 orders a month, for 8 months.
LTV (INR): 40 × 3 × 8 = 960
Step 4: LTV compared with CAC
What a strong candidate does: Divide LTV by the cost to win the customer.
LTV to CAC ratio: 960 ÷ 300 = 3.2

The recommendation to listen for

At the end, say: "The CEO walks in. What is your recommendation?"

Yes, the app should keep winning customers, since each one brings about INR 960 of contribution for INR 300 of marketing, an LTV to CAC ratio of about 3.2. This is because each order contributes INR 40, and a customer orders 3 times a month for 8 months. The biggest levers are keeping customers longer and lowering the INR 45 rider cost per order. The main risk is churn: if customers leave after 3 months instead of 8, LTV falls to INR 360, close to the cost of winning them. Next, track retention by monthly cohort before raising the marketing budget.

Risks a strong answer names: This ignores fixed costs such as the tech team; If customers leave after 3 months instead of 8, LTV falls to INR 360.

Score the candidate

Score each criterion from 1 to 5. A 2 or a 4 sits between the descriptions.

This case has no exhibit. Score Exhibit reading on how the candidate used the data you gave them: did they pick out the number that matters and say what it means?

Structuring

1: No clear structure, or a memorized framework that does not fit the problem.
3: A sensible structure, but with some overlap, a gap, or no clear priority.
5: A structure built for this problem, with no overlap and no gaps, a stated hypothesis, and a clear first step.

Math

1: Frequent errors, no units, or needed heavy help to finish.
3: Right answers but slow or messy working, or one error caught late.
5: Accurate and clearly narrated, with units, a sense check, and what the number means.

Exhibit reading

1: Read the chart aloud without finding the number that matters.
3: Found the key number but gave only part of the so-what.
5: Pulled the right number quickly and said what it means for the case.

Synthesis

1: Summarized what was done, with no clear answer.
3: Gave an answer, but with weak reasons or no next step.
5: Answer first, then two or three reasons with numbers, the main risk, and next steps.

Communication

1: Hard to follow: long silences, no signposting.
3: Clear most of the time, with some rambling.
5: Calm and concise, signposted each step, and checked in with the interviewer.

Total

0 out of 25

Score all five criteria to see the band and the feedback template.