New Rubber Plant Investment

Are you looking for a case study with answers to help you prepare for your second round Kearney interview? Check out the prompt below and get started!

Case Study Prompt

The federal government of X country is investigating whether to restart a rubber factory in the western part of the country. Factory was operational in past but has not been used for 7 years. The plant was closed due to terrorism in the area (now diminished significantly but there are still issues and skirmishes reported). If rejuvenated, the plant may become a target for the rebels. 

All the equipment is considered useable but the government still estimates to spend $12M to rejuvenate the plant which would enable the plant to produce up to 10M lbs. of rubber per month. The demand of rubber worldwide is strong but rubber must be transported to an export port via trains; up to 2 trains per day can used for this. 

The raw material is gum resin. 3lb of resin after processing results in 1lb of rubber. Resins come from the capital. Up to 4 trains can be used for the same. Rubber can be sold at $20 per lb. Gum resin costs $5 per lb. We have identified one supplier. We would be selling the rubber in the commodity market to the entire world.

Lay out a structure you would use to advise if the federal government should restart a rubber factory in the western part of the country. 

Case Study Overview

In this case study with answers, your client is the government of a foreign country wondering if they should restart a rubber factory in the western part of the country – in an area where the plant could become a target for rebels. This is a case where your ability to provide a sound recommendation could have quite the impact. It’s your job to dig into profitability and do your research to get to know the ins and outs of this case and then make the best recommendation possible.

You can use the Profitability framework to solve this case, but due to unique nature of this case we recommend that you don’t stop there. Take the framework and add your own business experience and know-how to come up with a structure that will fit this specific case.

This case contains 3 math diagrams, and is an advanced level case study you would find in a Kearney second round with a qualitative difficulty of 4 out of 4.

Kearney Interview Tips

What does Kearney look for in its candidates? High level quant skills

Make sure you bring your quant skills A-GAME with you to this interview.

As you walk through the case, focus on these things:

• Come away with 1 or 2 areas of improvement
• Focus on timing yourself as you present (2min for structure, 5min for math, 2min for brainstorming, 2min for conclusion)
• Work on your overall polish and presentation.

If you’re looking for another case study with answers, check out our case library.

For out-loud practice with an expert, book an hour with an ex-MBB coach.