Interviewer view · keep this screen to yourself
An Indian snack brand enters Saudi Arabia
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
1. Read the prompt aloud
Read it slowly, then pause. Let the candidate ask questions before they structure.
An Indian snack brand is considering Saudi Arabia, a market of about 500 million packs a year. It expects to reach 1 percent share in year one, 2.5 percent in year two, and 4 percent in year three, earning a contribution of SAR 0.50 per pack. Running the local business (team, marketing, and fees to get on shelves) costs SAR 4 million a year, and the one-time entry cost (setup, product registration, halal certification) is SAR 6 million. Does it pay back within three years, and how should it enter?
Format note: Candidate-led: you build the structure, ask for the market facts, and propose the entry mode; the interviewer adds facts only when you ask.
2. Answers to clarifying questions
Give these answers only if the candidate asks. If they ask something not listed, give a sensible answer or say it does not matter here.
If asked: What is the client's goal and hurdle?
Answer: Profitable growth outside India, with the entry cost paid back within three years.
If asked: How big and how crowded is the market?
Answer: About 500 million packs a year, growing about 6 percent a year. The top three brands hold about 60 percent.
If asked: Is the SAR 0.50 per pack before or after local costs?
Answer: It is contribution, meaning price minus the variable cost of making, shipping, and distributing each pack. Local fixed costs are separate.
3. The hypothesis a strong candidate states
Listen for an early, testable guess like this one. It does not need to match word for word.
The market is large and growing, and the brand is already known to many South Asian residents of Saudi Arabia. My hypothesis is that entry is attractive, and that the swing factor is whether the brand reaches meaningful share fast enough to cover local fixed costs.
4. 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.
- Should we enter, and how?This comes from value = market size x share x profit per pack over the ramp-up, minus yearly costs and the one-time entry cost.
- Attractive? Size, growth, competition
- Can we win? Brand awareness, shelf access
- Key: Economics: ramp-up profit versus entry cost
- How: build, partner, or buy
5. 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: Attractiveness
What a strong candidate does: A market of 500 million packs a year growing about 6 percent a year is attractive. Three brands hold about 60 percent, so it is competitive but not closed.
Step 2: Ability to win
What a strong candidate does: Many South Asian residents already know the brand, which gives a starting customer base. The weak point is shelf access, because large retailers favor brands they already stock.
Step 3: Year one, building alone
What a strong candidate does: 1 percent of 500 million packs at SAR 0.50 each, minus SAR 4 million of local fixed costs: a loss.
Year 1 profit (SAR): 500,000,000 × 0.01 × 0.5 - 4,000,000 = -1,500,000
Step 4: Year two
What a strong candidate does: At 2.5 percent share.
Year 2 profit (SAR): 500,000,000 × 0.025 × 0.5 - 4,000,000 = 2,250,000
Step 5: Year three
What a strong candidate does: At 4 percent share.
Year 3 profit (SAR): 500,000,000 × 0.04 × 0.5 - 4,000,000 = 6,000,000
Step 6: Cumulative after three years
What a strong candidate does: Start with the SAR 6 million entry cost and add the three years. The total is only just positive, so the plan barely meets the hurdle.
Cumulative cash after 3 years (SAR): -6,000,000 - 1,500,000 + 2,250,000 + 6,000,000 = 750,000
Step 7: Downside: share stalls at 3 percent
What a strong candidate does: If year-three share is 3 percent instead of 4, the plan misses the hurdle.
Cumulative cash, 3 percent case (SAR): -6,000,000 - 1,500,000 + 2,250,000 + (500,000,000 × 0.03 × 0.5 - 4,000,000) = -1,750,000
Step 8: Partner instead of building
What a strong candidate does: A local distributor would take SAR 0.10 per pack (contribution falls to SAR 0.40) but local fixed costs fall to SAR 2 million a year because the partner already has a sales team and retailer contracts. Buying a local brand would be fastest, but the interviewer says it would cost about SAR 60 million, ten times the entry cost.
Cumulative cash with a partner (SAR): -6,000,000 + (500,000,000 × 0.01 × 0.4 - 2,000,000) + (500,000,000 × 0.025 × 0.4 - 2,000,000) + (500,000,000 × 0.04 × 0.4 - 2,000,000) = 3,000,000
Step 9: Partner downside: share stalls at 3 percent
What a strong candidate does: Run the same downside on the partner route. Year-three profit falls to SAR 4 million, and the plan still pays back.
Cumulative cash with a partner, 3 percent case (SAR): -6,000,000 + (500,000,000 × 0.01 × 0.4 - 2,000,000) + (500,000,000 × 0.025 × 0.4 - 2,000,000) + (500,000,000 × 0.03 × 0.4 - 2,000,000) = 1,000,000
The recommendation to listen for
At the end, say: "The CEO walks in. What is your recommendation?"
Enter Saudi Arabia through a local distribution partner rather than building our own sales force. First, building alone only just pays back in three years, with SAR 0.75 million of cumulative cash. Second, building fails if year-three share reaches 3 percent instead of 4, at minus SAR 1.75 million. Third, with a partner, lower fixed costs give SAR 3 million of cumulative cash by year three, no loss in year one, and still SAR 1 million if share stalls at 3 percent, while buying a local brand would cost about SAR 60 million, ten times the entry cost. The key risk is the share ramp, so agree share targets with the partner and review after year one; consider buying a local brand only if share stalls.
Risks a strong answer names: Year-three share of 4 percent may be optimistic against three strong local and international brands; A partner controls shelf access, so a weak partner slows the ramp; Incumbents may respond with promotions in year one.
Next steps: Shortlist and interview three distribution partners; Test the brand with shoppers in Riyadh and Jeddah to check the share assumption; Confirm registration and halal certification timelines.
Strong versus weak
A strong answer
Covered attractiveness and ability to win briefly, modeled a share ramp with fixed costs, tested the downside, and let the numbers choose the entry mode.
A weak answer
Multiplied full target share by profit per pack for year one, found a payback under one year, and said yes without asking how to enter.
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?
Total
0 out of 25
Score all five criteria to see the band and the feedback template.