European Beauty Company
Practice this intermediate profitability case interview question from McKinsey in the Consumer Goods sector. Includes detailed problem prompt, clarifying questions, structured framework, and expert recommendation. Part of ProHub's 835+ consulting case library.
ProHub Comment
This is a profitability case requiring candidates to diagnose declining margins despite revenue growth. The key insight is that beauty advisor costs (sales commissions) are growing faster than revenue, rising from 20% to 25% of total revenue. Candidates must analyze revenue drivers, cost structure, and evaluate strategic initiatives like new product launches and digital solutions.
Estimated Time
26 minutes
Difficulty
Medium
Source
PeterK
40
/ 100
Your client is a European beauty company that offers fragrance, makeup, and skincare. Their profitability has been decreasing recently. They have reached out to you to get your advice on how they can increase their profitability.
Clarifying Information
- Distribution channels include chain retail stores (similar to Walmart, Target) and beauty chains (similar to Sephora, Ulta).
- Makeup offerings are the client’s legacy products, and they recently launched a skincare line.
- We don’t know about the financial goals of the client.
- The client operates in multiple European countries.