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BCG Medium Revenue Growth

AgriCo

#Agriculture #Agricultural Machinery #Manufacturing
ProHub Comment

This is a classic revenue growth case that combines market analysis with hypothesis generation. The key challenge is explaining why the client underperformed despite strong market tailwinds (18% market growth vs. -15% client performance). The case requires candidates to diagnose root causes across four dimensions: marketing, pricing, distribution efficiency, and value proposition, while also applying financial analysis to pricing initiatives.

Estimated Time 15 minutes
Difficulty Medium
Source PeterK
50 / 100
Your client is a U.S.-based agricultural machinery manufacturer that was established in early 1990s and is a well-known and respected brand. The farm tractors represent one of the major product lines they offer. In 2020 their U.S. sales of tractors dropped by 15%. They reached out to you to get your advice on how they can reverse this trend and boost the sales of farm tractors.

Clarifying Information

  1. The U.S. covid-19 aid package for U.S. farmers, along with the rise in agriculture product prices, as well as an extended fleet age, all contributed to sky-rocketing growth of farm tractor market in 2020
  2. The farm tractor space is fairly fragmented with top-5 manufacturers controlling 30-40% of the market
  3. The client’s U.S. sales of tractors fell to $0.7B in 2020
  4. The client offers three types of tractors: compact tractors (under 40 horsepower (HP)), utility tractors (40-100 HP), and high horsepower tractors (100+ HP)
  5. The client didn’t provide any revenue goals