Saffron Retail: Finding 18% Growth
Consulting
medium45 min0 submissionsBCG
Scenario
Saffron Retail (apparel retail, India) has grown at 5% a year for three years. The new CEO has committed the board to 18% growth — a gap of roughly ₹171 Cr of incremental revenue in year one.
What we know.
- Current revenue: ₹1319 Cr
- 415 active customers
- Annual customer churn: 19%
- Estimated share of existing customers' relevant spend: 18%
- The core market is growing at 4% — so the company is roughly holding share
The CEO's instinct is to enter a new geography. The CFO thinks the answer is in the existing base. Nobody has yet sized either.
Supporting data
market
- core market growth pct
- 4
customers
- active customers
- 415
- annual churn pct
- 19
- share of wallet pct
- 18
- average revenue per customer
- 3178313
current state
- growth pct
- 5
- revenue cr
- 1319
- revenue gap cr
- 171
- target growth pct
- 18
Your task
Build the growth case. Provide:
- Analysis — where growth could come from, sized.
- Risks — of the options you recommend and reject.
- Recommendation — a prioritised growth portfolio for the next 24 months.
Ready to move forward? Up next: Should Corveta Motors Enter Brazil?Next question
How you'll be graded
100 points, 60% to pass.
- evaluation25
- recommendation25
- option generation25
- problem structuring25
Hint
Reveal suggested structure
Decompose growth into five sources and size each:
- Retention — reducing 19% churn
- Penetration — raising 18% share of wallet
- New customers in existing segments
- New products to existing customers
- New geographies or segments
Score on size, speed, cost and risk. The first two are usually cheapest and fastest; the last is usually slowest.