Pallas Pharma: Plenty of Demand, Nothing to Buy

Product Management
hard45 min0 submissions
McKinsey
Scenario

Pallas Pharma runs a specialty pharma marketplace in US, live in 30 cities.

Last month: 121,565 active buyers, 13,695 active sellers, 597,762 searches, and an overall fill rate of 51%.

That average conceals a wide spread. The three largest cities fill at about 92%. The bottom half of cities fill at around 23%.

Growth marketing has been buying buyer-side installs, because buyer acquisition is cheaper and the install numbers look good in the board deck. Supply acquisition is manual and slow.

Supporting data

scale

searches
597762
active buyers
121565
active sellers
13695
buyer to seller ratio
8.9

liquidity

cities live
30
overall fill rate pct
51
top 3 cities fill pct
92
bottom half cities fill pct
23

acquisition

buyer side
paid, scaling
seller side
manual, flat
Your task

Advise the general manager. Your answer should provide:

  1. Analysis — which side is constrained, where, and what the fill rate really says.
  2. Risks — what happens if you keep acquiring on the current side.
  3. Recommendation — which side, which cities, which mechanism, and the metric that proves it.

State any assumptions you make.

Ready to move forward? Up next: Northwind Energy: Plenty of Demand, Nothing to BuyNext question
How you'll be graded

80 points, 60% to pass.

  • recommendation15
  • market analysis25
  • risk assessment20
  • financial analysis20
Hint
Reveal suggested structure

Liquidity is local. Find the constrained side per geography, stop acquiring on the long side, and concentrate supply until density crosses the threshold.