Sizing Amazon UK's Face-Mask Demand and Inventory for a COVID-19 Lockdown

Quick Overview

An estimation question for an Amazon product role: size how many face masks Amazon should stock for UK customers during a COVID-19 lockdown. It tests building a demand equation, segmenting people by how often they go out, separating disposable from reusable masks, estimating Amazon's share of purchases and sanity-checking the result.

Sizing Amazon UK's Face-Mask Demand and Inventory for a COVID-19 Lockdown

Company: Amazon

Role: Product Manager

Category: Product / Decision Making

Difficulty: medium

Interview Round: Other

Imagine you are a product delivery manager at Amazon while the United Kingdom is under a COVID-19 lockdown. Estimate the number of face masks Amazon should have in stock for its UK stores for the duration of the lockdown. Lay out your equation, the assumption behind each input and the arithmetic. ```hint Usage first, then Amazon's slice Mask demand depends on how often people leave home and whether they throw masks away or wash and reuse them. Size that for the whole country before asking how much of it would be bought from Amazon. ``` ### Clarifying Questions - Does "UK stores" mean Amazon's UK online store and the warehouses that serve it, or physical retail locations? - How long is the lockdown we are planning for, and do you want the total units sold over that period or the inventory to hold at any one time? - Which masks are in scope: disposable masks, reusable cloth masks, or also medical-grade masks for health workers? - Are face coverings required in shops and on public transport during this lockdown, or only recommended? ### What a Strong Answer Covers - A clear equation, with the population segmented by how often people go out and whether they would wear a mask. - Separate treatment of disposable and reusable masks, and an explicit time period. - A step from total UK demand to Amazon's share, through the share of masks bought online and Amazon's share of online sales. - Assumptions labeled as assumptions with round numbers, correct arithmetic and a sanity check. - A translation of the total into a stocking plan: weekly run rate, supplier lead time, safety stock and the surge at the start of a lockdown. ### Follow-up Questions - Partway through the lockdown, masks become mandatory in shops. What changes in your estimate and in how you restock? - Which assumption is your number most sensitive to, and what early sales or search data would you use to correct it? - How would you avoid being left with excess stock when the lockdown ends?

Overview: An estimation question for an Amazon product role: size how many face masks Amazon should stock for UK customers during a COVID-19 lockdown. It tests building a demand equation, segmenting people by how often they go out, separating disposable from reusable masks, estimating Amazon's share of purchases and sanity-checking the result.

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Amazon
Jul 29, 2024
mediumProduct ManagerOtherProduct / Decision Making
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Imagine you are a product delivery manager at Amazon while the United Kingdom is under a COVID-19 lockdown. Estimate the number of face masks Amazon should have in stock for its UK stores for the duration of the lockdown. Lay out your equation, the assumption behind each input and the arithmetic.

Clarifying Questions Guidance

  • Does "UK stores" mean Amazon's UK online store and the warehouses that serve it, or physical retail locations?
  • How long is the lockdown we are planning for, and do you want the total units sold over that period or the inventory to hold at any one time?
  • Which masks are in scope: disposable masks, reusable cloth masks, or also medical-grade masks for health workers?
  • Are face coverings required in shops and on public transport during this lockdown, or only recommended?

What a Strong Answer Covers Guidance

  • A clear equation, with the population segmented by how often people go out and whether they would wear a mask.
  • Separate treatment of disposable and reusable masks, and an explicit time period.
  • A step from total UK demand to Amazon's share, through the share of masks bought online and Amazon's share of online sales.
  • Assumptions labeled as assumptions with round numbers, correct arithmetic and a sanity check.
  • A translation of the total into a stocking plan: weekly run rate, supplier lead time, safety stock and the surge at the start of a lockdown.

Follow-up Questions Guidance

  • Partway through the lockdown, masks become mandatory in shops. What changes in your estimate and in how you restock?
  • Which assumption is your number most sensitive to, and what early sales or search data would you use to correct it?
  • How would you avoid being left with excess stock when the lockdown ends?