Your client is a book publisher who deals in fiction and wants to increase profitability. Book prices are $15 regardless of category or size. There is no difference in fixed costs across categories. Material costs are the same for all books. Bigger authors require higher royalties than smaller authors.
Author is the primary driver to determine a ‘best-seller’. There are huge economies of scale in printing. Small sellers are primarily distributed via independent bookstores, requiring higher per-unit distribution costs. 80% of space dedicated to small & breakout sellers. We can not currently determine which books will become breakouts.
The client wants to understand why profits look the way they do, and what it can do to improve profitability.
This is a Profitability case study in the Booz Allen Hamilton style. Your client – a book publisher – wants to increase their profits and is looking to you to help them understand their situation and develop a strategy for growth.
The Profitability Framework will prove useful for this case study, but allow yourself to bring your own business experience to the table and develop a custom framework for this specific problem.
There are math exhibits in this case. This a beginner level case interview you could expect to see in a first round at Booz Allen Hamilton. The case has a qualitative difficulty score of 2 out of 4.
Booz Allen Hamilton Interview Tips
BAH looks for excellent presentation and interpersonal skills in their top candidates. This firm puts more store in personality and communication, so make sure you keep that in mind as you prepare.
To get the most from this case study:
- Focus on coming away with 1 or 2 takeaways that you can improve on in your next case.
- Time yourself as you go through the case: 4min for creating and presenting your structure, 2min for brainstorming, and 2min for a recommendation.
Again, there are different types of case study. We recommend practicing multiple types in preparation for your interviews (market study, M&A, profitability, etc.)
For out-loud practice with an expert, book an hour with an ex-MBB coach.
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