General interview questions
practise general
cases, market sizing and curveballs 5
1Imagine you had £100,000 to invest. Where would you put it?
difficulty 3/5
a good answer hits
- Establishes risk tolerance and investment horizon before allocating anything.
- Puts the bulk, around 60%, into a diversified global equity index fund for long-run market exposure.
- Allocates around 30% to fixed income or cash-like instruments for capital preservation.
- Reserves a small slice, around 10%, for high-conviction individual positions or alternatives.
- Explains the reasoning: broad diversification as the core, with a bounded allocation for active views.
- Gives a specific allocation with numbers rather than generalities about diversification.
common mistakes
- Answering with an asset class and no allocation, or an allocation with no reasoning behind it.
- Putting the whole sum into individual stock picks, which reads as an untested punt rather than a strategy.
- Skipping risk tolerance and time horizon, which are what make any allocation defensible.
- Naming a single hot sector or stock without acknowledging the concentration risk.
full answer
If I had £100,000 to invest, I would first establish my risk tolerance and investment horizon. For a balanced, long-term portfolio, I would allocate 60% to a diversified global equity index fund to capture market growth, 30% to fixed-income securities or high-yield savings for capital preservation, and reserve the remaining 10% for high-conviction individual stocks or alternative assets. This strategy ensures broad diversification while allowing for targeted exposure to high-growth sectors.
2Can you explain how industrials is different from other groups and what the main verticals are?
difficulty 2/5
a good answer hits
- Defines industrials as companies producing, transporting or servicing heavy physical goods.
- States that the customers are corporates and governments rather than consumers.
- Explains that this makes the sector highly sensitive to interest rates, credit availability and trade policy.
- Names the three main verticals: capital goods, transportation, and commercial and professional services.
common mistakes
- Treating industrials as a single homogeneous sector rather than three quite different verticals.
- Missing the macro sensitivity, which is what drives the cyclicality of the multiples.
- Confusing industrials with consumer discretionary because both are cyclical.
full answer
Industrials companies produce, transport, or service heavy physical goods, primarily serving corporate or government clients rather than consumers. This makes the sector highly sensitive to macroeconomic factors like interest rates, credit availability, and trade policies. The sector is generally divided into three main verticals: capital goods, transportation, and commercial/professional services.
3A company loses a key supplier of components, essential for making its product. What can the company do to continue operations and remain profitable?
difficulty 3/5
a good answer hits
- To mitigate the loss of a key supplier, the company should immediately assess its existing inventory levels to determine how long it can sustain operations.
- Simultaneously, management must identify and qualify alternative suppliers, potentially diversifying the supply chain to avoid future single-point-of-failure risks.
- In the short term, the company can also explore renegotiating terms with secondary suppliers or temporarily adjusting its product mix to focus on goods that do not rely on the missing component.
common mistakes
- Jumping straight to finding a new supplier without first establishing how much runway the inventory gives.
- Ignoring the qualification and lead time a new supplier requires.
- Treating it purely as a procurement problem and missing the working capital and customer commitments at stake.
- Failing to address the structural fix, namely reducing single-source dependency.
full answer
To mitigate the loss of a key supplier, the company should immediately assess its existing inventory levels to determine how long it can sustain operations. Simultaneously, management must identify and qualify alternative suppliers, potentially diversifying the supply chain to avoid future single-point-of-failure risks. In the short term, the company can also explore renegotiating terms with secondary suppliers or temporarily adjusting its product mix to focus on goods that do not rely on the missing component.
4How much revenue does Harrods bring in per year?
difficulty 3/5
a good answer hits
- We can estimate Harrods' revenue by analyzing its retail space and sales per square foot.
- Assuming Harrods has about 1 million square feet of selling space and generates approximately £800 to £1,000 in sales per square foot annually, the estimated annual revenue would be between £800 million and £1 billion.
- This aligns with its status as one of the world's highest-performing luxury department stores.
common mistakes
- Producing a figure without a stated method behind it.
- Confusing total floor area with sellable retail space, which is a fraction of it.
- Using a general department store sales-per-square-foot figure for a luxury flagship, where it is far higher.
- Failing to sanity-check the result against any known reference point for a store of this profile.
full answer
We can estimate Harrods' revenue by analyzing its retail space and sales per square foot. Assuming Harrods has about 1 million square feet of selling space and generates approximately £800 to £1,000 in sales per square foot annually, the estimated annual revenue would be between £800 million and £1 billion. This aligns with its status as one of the world's highest-performing luxury department stores.
5How many petrol stations are there in the UK?
difficulty 3/5
a good answer hits
- To estimate this, we can start with the UK population of approximately 67 million people.
- Assuming an average household size of 2.5, there are about 27 million households, with roughly 80% owning at least one car, resulting in about 22 million cars.
- If each car refuels once every 10 days, there are 2.2 million refuels per day; assuming an average petrol station serves 250 cars daily, we estimate there are roughly 8,800 petrol stations in the UK.
common mistakes
- Guessing a number with no visible chain of assumptions.
- Failing to state each assumption explicitly so the interviewer can challenge one.
- Losing an order of magnitude in the arithmetic and not sanity-checking the result.
- Refusing to commit to a final number after building the estimate.
full answer
To estimate this, we can start with the UK population of approximately 67 million people. Assuming an average household size of 2.5, there are about 27 million households, with roughly 80% owning at least one car, resulting in about 22 million cars. If each car refuels once every 10 days, there are 2.2 million refuels per day; assuming an average petrol station serves 250 cars daily, we estimate there are roughly 8,800 petrol stations in the UK.