How many 🐄?
07.06.2020 - Today's market sizing exercise
Hello Case Dojo,
Today we have a fun market sizing question for you. Remember, if you make an error there is no need to cry over spilled milk. Instead, correct your mistakes and power through. Good luck and have fun!
Reminders
Spell out your thinking process, state your assumptions, and evaluate your final answer. There are many valid approaches to each problem.
No calculators are allowed, so make the math easy for yourself.
Try to come to an answer within 3-4 minutes at the longest (here’s a timer).
Today’s Question
How many cows are there in the United States?
Our sample answer
How we broke things down
We want to calculate the number of cows by estimating how many cows each farmer has and multiplying by the number of farmers.
To find the number of farmers, we segment by geographic region (Midwest, Northeast, West, and South). This is because we believe farmers represent a larger proportion of the workforce in agriculture-heavy regions.
Within each region, we guess at the percentage of the workforce that is farmers. Multiplying that percentage by the number of workers in each region yields the total number of farmers for each region.
We add up the regions to get the total number of farmers and multiply by our estimate for the numbers of cows per farmer.
Assumptions we made
US population = 360M people.
Labor force = 1/3 US Population.
Workers are evenly distributed between geographic regions.
Percentage of the workforce in agriculture for each region (Midwest: 10%, Northeast: 1%, West: 5%, South: 10%), which is based on our assumption that farming is far more common in the Midwest and South compared to the Northeast.
Number of cows per farmer = 50, which is an estimate based on how many animals a person can reasonably service in a day.
Our evaluation
We arrived at 390M cows. We believe our answer is a slight overestimate because 1.) multiple farmers may work on a single farm 2.) not every farm raises cows and 3.) our assumption for the US population is about 10% above the actual population.
Other potential approaches we like
Multiply the number of cows on each farm by the number of farms
Estimate how many cows are necessary to produce the amount of dairy Americans consume in a week?
Actual answer
There are 90M cows in the United States.
Extras
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🤠Fun Fact
Cows are devotional mothers and are known to walk for miles to find their calves.
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