Free delivery hangover

A product strategy question from a product manager interview, set at Pantry Pass, a fictional food & grocery delivery company.

The question

Skills this case tests

A starting structure

Programme profit = membership fees − cost of free deliveries; per member = monthly fee − orders per month × net cost per order

How to approach this case

Start with how Finance calculates the loss and what it includes. Ask whether the programme is judged on fees against delivery costs, or on everything a member brings in. Then name the tension: the CFO wants better economics this quarter, and the CEO does not want to lose members. Next, find where the loss sits. Does every member lose money, or only some? Cut by how often members order, basket size and delivery distance. Lay out the options as a tree: change the price, change what is free, add fees, or get partners to pay. For each one, ask which members would leave and whether those are the ones costing money. Look at what competitors limit. A strong close sizes two or three levers, tests them against a member holdout, and watches renewals by segment, not just orders.

The full method for strategy, pricing and growth questions

After the mock interview you get scores on five skills, what to fix with quotes from your answers, and the ideal path for this case.