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Cotton T-shirts from India to Hamburg

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.

A fictional retailer in Hamburg buys 20,000 cotton T-shirts from a factory in Tiruppur, India, at USD 4.00 each FOB. Sea freight is USD 0.30 a shirt and insurance USD 0.02. The EU tariff database (TARIC) showed a duty of 9.6 percent on 1 October 2026 for Indian cotton T-shirts that meet the EU's preference rules. Without them the duty is 12 percent. Clearance and port fees are EUR 0.05 a shirt and the truck to the warehouse EUR 0.08. Financing and holding the goods on the way and in stock cost 1.5 percent of their value. Assume USD 1.20 buys EUR 1. What is the landed cost per shirt, and what happens if the dollar strengthens to USD 1.08 per euro?

2. Answers to clarifying questions

This case has no scripted clarifying answers. Answer from the prompt, and say "assume what you think is reasonable" if the prompt does not cover it.

3. 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.

Landed cost = CIF in euros + duty on CIF + clearance and truck + financing
- CIF: FOB + freight + insurance, converted to euros
- EU duty: 9.6 percent of the CIF value
- Fees, truck and financing
- Key: Currency sensitivity

Exhibit 1

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

Landed cost per T-shirt at two exchange rates (EUR, rounded)(EUR per shirt)

Landed cost per T-shirt at two exchange rates (EUR, rounded)
Cost item	At USD 1.20 per EUR	At USD 1.08 per EUR
Product (FOB)	3.33	3.7
Freight and insurance	0.27	0.3
EU duty at 9.6 percent	0.35	0.38
Clearance, port and truck	0.13	0.13
Financing and holding	0.05	0.06
Landed cost	4.13	4.57

So-what

Landed cost is about a quarter above the FOB price, and a stronger dollar adds more than a tenth again.

4. 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: CIF in dollars
What a strong candidate does: FOB plus freight plus insurance.
CIF per shirt (USD): 4 + 0.3 + 0.02 = 4.32
Step 2: CIF in euros
What a strong candidate does: Divide by USD 1.20 per euro.
CIF per shirt (EUR): 4.32 ÷ 1.2 = 3.6
Step 3: EU duty
What a strong candidate does: The EU charges duty on the value including freight and insurance.
Duty per shirt (EUR): 3.6 × 0.096 = 0.3456
Step 4: Financing and holding
What a strong candidate does: 1.5 percent of the CIF value.
Financing per shirt (EUR): 3.6 × 0.015 = 0.054
Step 5: Landed cost
What a strong candidate does: CIF, duty, fees, truck and financing.
Landed cost per shirt (EUR): 3.6 + 0.3456 + 0.05 + 0.08 + 0.054 = 4.13
Step 6: Mark-up on the invoice price
What a strong candidate does: Compared with FOB in euros (USD 4.00 divided by 1.20).
Landed cost above FOB (percent): (4.1296 ÷ (4 ÷ 1.2) - 1) × 100 = 23.89
Step 7: At USD 1.08 per euro
What a strong candidate does: CIF becomes EUR 4.00; duty and financing rise with it.
Landed cost per shirt at USD 1.08 (EUR): 4.32 ÷ 1.08 + 4.32 ÷ 1.08 × 0.096 + 0.05 + 0.08 + 4.32 ÷ 1.08 × 0.015 = 4.57
Step 8: Cost of the currency move
What a strong candidate does: The rise per shirt times 20,000 shirts.
Extra cost of the order from the currency move (EUR): (4.574 - 4.1296) × 20,000 = 8,888

The recommendation to listen for

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

The retailer should set its prices from a landed cost of about EUR 4.13 a shirt, not the EUR 3.33 invoice price. It should protect the season with a currency hedge (a contract that fixes the exchange rate). First, freight, duty, fees and financing add about 24 percent to the invoice price. Second, the dollar may strengthen from 1.20 to 1.08 per euro. Then landed cost rises to about EUR 4.57 and the order costs about EUR 8,900 more. The risk is losing the 9.6 percent rate. Without valid proof of origin the duty is 12 percent, about EUR 0.09 more per shirt. As a next step, buy dollars forward for the order and confirm the supplier's origin paperwork before the goods ship.

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.

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