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Standard: Lotus Corner: night staff costs in Hong Kong convenience stores

You run the case. Read the prompt, answer questions from the notes below, and share data only when the candidate asks for it or gets stuck. Score at the end.

Case timer

00:00

Target length:

1. Read the prompt aloud

Read it slowly, then pause. Let the candidate ask questions before they structure.

Lotus Corner runs 120 convenience stores in Hong Kong, all open 24 hours. Its night staff costs have risen, and the board asks whether every store should stay open all night. The exhibit shows night trading by type of store. What should Lotus Corner do?

Format note: Difficulty: Standard. Format: interviewer-led, with an exhibit. Industry: Convenience retail. Region: Hong Kong. Interview length: about 30 minutes. The company is fictional. All figures are illustrative, except the facts that name their source.

2. Answers to clarifying questions

Give these answers only if the candidate asks. If they ask something not listed, give a sensible answer or say it does not matter here.

If asked: Who works at night, and what are they paid?
Answer: Two staff per store from 11 pm to 7 am, an 8-hour shift. They earn the statutory minimum wage, which rose to HKD 43.1 an hour on 1 May 2026 (Hong Kong Labour Department, checked 2026-10-02). Other employment costs add 20 percent (illustrative).
If asked: Are all the stores alike?
Answer: No. 40 stores are near MTR stations and nightlife; 80 are on quiet residential streets (illustrative).
If asked: What would closing at night lose besides night sales?
Answer: I will come back to that.

3. The hypothesis a strong candidate states

Listen for an early, testable guess like this one. It does not need to match word for word.

The night shift costs the same in every store, but night sales differ by area. My hypothesis is that busy stores pay for their nights and quiet ones do not.

4. A model structure

Compare the candidate's structure with this one. A different split can be just as good if it is clean and fits the problem.

Night contribution per store = night sales x margin - night staff cost, by type of store
- Key: Night sales by type of store: busy or quiet
- Night staff cost: hours x minimum wage x other employment costs
- Daytime sales lost if a store closes at night
- Safety and what customers expect of the brand

Exhibit 1

Reveal to candidate: when they ask for this data, say "Open Exhibit 1" (they press "Show exhibit 1" on their screen).

Lotus Corner night trading by type of store (illustrative)

Lotus Corner night trading by type of store (illustrative)
Measure	Busy stores	Quiet stores
Stores	40	80
Night sales per store (HKD a night)	6,000	1,500
Gross margin on sales (%)	30	30
Night staff per store	2	2
Daytime sales per store (HKD a day)	40,000	25,000

So-what

The average hides two different businesses: busy stores earn well at night, while quiet stores lose money every night they stay open.

5. The working, step by step

Each step shows how a strong candidate works it out. Share a new fact from it only when the candidate asks or is stuck, and let them do the math: the result in the dark box is what they should reach.

Step 1: Night staff cost per store
What a strong candidate does: Two staff for 8 hours at HKD 43.1, plus 20 percent.
Night staff cost per store (HKD a night): 2 × 8 × 43.1 × 1.2 = 828
Step 2: Average night sales
What a strong candidate does: The board looked at the average across all 120 stores. At a 30 percent margin it earns HKD 900, which seems to cover the staff.
Average night sales per store (HKD): (40 × 6,000 + 80 × 1,500) ÷ 120 = 3,000
Step 3: A busy store at night
What a strong candidate does: HKD 6,000 of sales at a 30 percent margin, minus night staff.
Night contribution, busy store (HKD a night): 6,000 × 0.3 - 2 × 8 × 43.1 × 1.2 = 972
Step 4: A quiet store at night
What a strong candidate does: HKD 1,500 of sales at the same margin, minus the same staff cost.
Night contribution, quiet store (HKD a night): 1,500 × 0.3 - 2 × 8 × 43.1 × 1.2 = -378
Step 5: Yearly loss from quiet stores at night
What a strong candidate does: 80 quiet stores, 365 nights.
Night result of quiet stores (HKD a year): 80 × 365 × (1,500 × 0.3 - 2 × 8 × 43.1 × 1.2) = -11,023,584
Step 6: Curveball: daytime shoppers
What a strong candidate does: Interviewer: "Closing at night would also lose about 2 percent of daytime sales in those stores, from shoppers who like a store that never closes." Margin lost on HKD 25,000 of daytime sales a day:
Daytime margin lost (HKD a year): 80 × 365 × 25,000 × 0.02 × 0.3 = 4,380,000
Step 7: Net gain from closing quiet stores at night
What a strong candidate does: The night loss avoided, minus the daytime margin lost.
Net gain from night closing (HKD a year): 80 × 365 × (2 × 8 × 43.1 × 1.2 - 1,500 × 0.3) - 80 × 365 × 25,000 × 0.02 × 0.3 = 6,643,584

The recommendation to listen for

At the end, say: "The CEO walks in. What is your recommendation?"

Lotus Corner should close its 80 quiet residential stores overnight and keep the 40 busy stores open all night. First, two night staff at the HKD 43.1 minimum wage cost HKD 827.52 a store each night. Second, a busy store makes HKD 972.48 a night after staff, but a quiet store loses HKD 377.52, about HKD 11.02 million a year across 80 stores. The average of HKD 3,000 of night sales hid this split. Third, even after losing HKD 4.38 million a year of daytime margin, closing quiet stores at night gains about HKD 6.64 million a year. Test night closing in ten quiet stores first and track their daytime sales.

Risks a strong answer names: Daytime shoppers may leave in larger numbers than the 2 percent expected; Rivals may win loyal customers by staying open all night.

Next steps: Close ten quiet stores at night for three months and compare their daytime sales with similar stores; Review night sales store by store each quarter, since some areas may change.

Strong versus weak

A strong answer

Split the stores by type instead of trusting the average, priced the night shift from the minimum wage, and checked what closing would cost in daytime sales.

A weak answer

Saw average night sales of HKD 3,000 covering the staff cost and kept every store open.

Score the candidate

Score each criterion from 1 to 5. A 2 or a 4 sits between the descriptions.

Structuring

1: No clear structure, or a memorized framework that does not fit the problem.
3: A sensible structure, but with some overlap, a gap, or no clear priority.
5: A structure built for this problem, with no overlap and no gaps, a stated hypothesis, and a clear first step.

Math

1: Frequent errors, no units, or needed heavy help to finish.
3: Right answers but slow or messy working, or one error caught late.
5: Accurate and clearly narrated, with units, a sense check, and what the number means.

Exhibit reading

1: Read the chart aloud without finding the number that matters.
3: Found the key number but gave only part of the so-what.
5: Pulled the right number quickly and said what it means for the case.

Synthesis

1: Summarized what was done, with no clear answer.
3: Gave an answer, but with weak reasons or no next step.
5: Answer first, then two or three reasons with numbers, the main risk, and next steps.

Communication

1: Hard to follow: long silences, no signposting.
3: Clear most of the time, with some rambling.
5: Calm and concise, signposted each step, and checked in with the interviewer.

Total

0 out of 25

Score all five criteria to see the band and the feedback template.

Next: another case in Partner mode

Swap roles and run the next case, so you both practise answering and scoring.

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