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Build big now, or build in phases?
The prompt
A logistics company plans a cold store in Dammam, Saudi Arabia, using the three scenarios in the table above. Option Big: 100 thousand pallet places, fixed costs of SAR 45 million a year. Option Phased: 60 thousand places now, with fixed costs of SAR 28 million a year. Land and permits are ready to add 40 thousand more later. Each stored pallet adds SAR 200 a year of variable cost. Compare yearly operating profit in each scenario. (Fictional company, illustrative figures.)
Your interviewer will share data as you ask for it. Ask clarifying questions, state a hypothesis, then lay out your structure out loud before you calculate.
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