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Market Sizing Urgent Help Bis!!!!!

Imagine you have to estimate the value of nursing home market in Germany, how would you approach the questions? What structure should you use? Also willing to pay for a proper answer 

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Top answer
Soh
Coach
edited on Jul 31, 2024
Commercial Strategy leader| Ex ZS | Ross MBA| Pharma/Market Size/M&A Expert| -30% 1st case| 15 min free consult

Hi,

Thanks for your question. 

Below is a basic structure. 

 

Value of nursing home market in Germany

Assuming value is Revenue - which is generally the case (market size is the total revenue generated by that entity)

Layer 1

# of nursing homes in Germany

Small 300

Medium 200

Big 100

Layer 2

average # of beds in the nursing home

Small 100

Medium 200

Big 500

Layer 3

Average length of stay for each patient 1 month 

Layer 4

Revenue per month per patient

Small  $10K

Medium  $20K

Big $30K

Layer 5

Utilization rate by hospital (annual) 

Small 90%

Medium 70%

Big 50%

Layer 6 

Total revenue

Multiple layer 1 to 6 (adding numbers for small, medium and big). Note utilization rate is % of year.

Feel free to get in touch if need more help.

Thanks,

Sohini

Anonymous
on Jul 31, 2024
Thank you very much, isn`t this approach tricky? how can I know the amount of nursing homes in Germany?
Florian
Coach
on Jul 31, 2024
1400 5-star reviews across platforms | 500+ offers | Highest-rated case book on Amazon | Uni lecturer in US, Asia, EU

Hi there,

  • Define the outcome variable, is it the number of nursing homes, revenue generated per year, etc?
  • Think about the population breakdown
  • Think about what segment of the population would need nursing
  • Think about how this splits between at-home care and nursing homes
  • Once you find the number of people, think about the revenue you generate per person per year (what it costs to be in a nursing home)
  • Multiply the two and you get to the market size (assuming we are looking at the revenue generated)
  • Think about additional considerations
  • Discuss your answer qualitatively

This is just a high-level approach and could/should be refined at each stage (e.g., the segments of the population that would need nursing homes, revenue paid).

Cheers,

Florian

Hagen
Coach
on Sep 30, 2024
#1 recommended coach | >95% success rate | most experience in consulting, interviewing, and coaching

Hi there,

I would be happy to share my thoughts on your question:

  • First of all, can you please provide a proposal that I can review?
  • Moreover, please keep in mind that most major strategy consulting firms have not used standalone market size estimations for a long time. While this does not mean it never happens, this type of case study question may not be very meaningful for both the candidate and interviewer, as only a few skills are being tested.
  • That being said, simpler market size estimations may still be a part of a case study, for instance when estimating the revenues of the client company is required.

If you would like a more detailed discussion on how to best prepare for your upcoming interviews, please don't hesitate to contact me directly.

Best,

Hagen

on Jul 31, 2024
Ex-BCG Principal | 8+ years consulting experience in SEA | BCG top interviewer & top performer

Hi,

I can share one specific tip: for a question like this, assuming value = revenue, it would be helpful to think about how many people actually need nursing homes and the price of one ‘space’ in a nursing home. 

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