Case prompts with a worked walkthrough

Worked walkthrough: the Jaipur bakery chain

This is the first prompt above, solved end to end. Every company detail and number is fictional, written so the maths works cleanly. Read it once, then try a different prompt yourself with the case timer.

The prompt

A family-run chain of 12 bakeries in Jaipur has seen profit fall 15% over the last year, even though revenue stayed roughly flat. Why, and what should the owners do?

Clarifying questions

• What is the owners' objective? To restore profit to last year's level within six months.
• Has anything changed in the business recently? The interviewer says: "Last year we moved from baking in each store to a central kitchen."
• Same 12 stores both years? Yes.

Structure

Profit = revenue − costs. Revenue is flat, so start with costs, but confirm that the revenue mix has not shifted in a way that hides a problem.

• Costs: ingredients (prices, quantity used, wastage), staff, rent, delivery commissions, utilities and other.
• Revenue check: number of bills, average bill, product mix.
• External: new competitors, changes in demand by time of day.

The data

The interviewer shares this (₹ crore):

So what: profit fell by ₹18 lakh, and ingredients account for ₹15 lakh of that — more than 80% of the fall. That is where to dig.

Digging into ingredients

Ask what drives ingredient cost: the price of ingredients, how much is sold, and how much is thrown away. The interviewer says supplier prices rose about 1% on average, sales volumes were flat, and unsold goods discarded at the end of the day rose from about 6% to about 8% of everything baked.

Quick check on the maths: if last year's ₹4.80 crore included 6% wastage, the ingredients that were actually sold cost 4.80 × 0.94 ≈ ₹4.51 crore. A 1% price rise takes that to about ₹4.56 crore. With 8% wastage, the bakery must buy 4.56 ÷ 0.92 ≈ ₹4.95 crore — exactly what we see. So roughly ₹10–11 lakh of the increase comes from extra wastage and about ₹4–5 lakh from prices.

So what: most of the problem is wastage, and it started when baking moved to the central kitchen.

Why did wastage rise?

The interviewer confirms that stores now receive one delivery each morning. To avoid running out in the evening, store managers order generously — and whatever is unsold at closing is thrown away.

Recommendation

"I recommend cutting wastage back to around 6% by changing how stores order and receive stock. That alone would recover roughly ₹10 lakh a year, more than half of the profit fall.

Three steps: first, set each store's order using its own sales by day of the week, rather than managers' estimates. Second, add a smaller afternoon delivery for the busiest stores so morning orders can be leaner. Third, sell the day's remaining items at a discount in the last hour instead of discarding them.

The main risk is that an afternoon delivery run costs more than it saves, so I'd pilot it in the three highest-volume stores first. Next, I'd want store-level wastage data and the cost of a second delivery run."

What made this answer work

• The structure used the business's own language — wastage, central kitchen, deliveries.
• Every table ended with a "so what".
• The maths was checked out loud, so the interviewer could follow it.
• The recommendation led, quantified the impact, and named a risk and a next step.