Retail cases are stores (and digital) as a network: comps vs new space, four-wall economics, and occupancy. They are not brand-manufacturer sell-in cases.
Last full pass: 24 August 2026.
McKinsey, BCG, Bain, and retail practices will give you a chain whose headline sales grew because it opened doors while comps were negative. That split is the whole interview. Manufacturer trade spend and sell-through live on consumer goods. Budget-on-ads lives on marketing. Store real estate (cap rates, NOI of the property company) can overlap real estate — but if the client is the retailer, you care about four-wall contribution, not the landlord’s cap rate, unless they own the boxes.
What you are deciding
- Open / close / resize stores.
- Why profit fell: comps, mix, shrink, occupancy, labor, digital, or new-store drag.
- Omnichannel: ship-from-store and returns can destroy four-wall if uncosted.
- Price architecture vs promo addiction.
Clarify owned vs leased (occupancy is rent vs depreciation). Clarify whether e-com is in comps. Clarify four-wall vs corporate (HQ, DC, brand ads). Ask whether new stores are in new trade areas or stacked on top of existing ones — cannibalization is the silent “growth” tax. Ask for mature-store four-wall, not a blended average that hides year-1 launch losses.
Open with: (1) total sales vs comps vs digital, (2) four-wall of new vs core vs bottom decile, (3) traffic / ticket / mix on comps, (4) occupancy and labor hours, (5) omnichannel cost (pick, pack, returns). A profitability tree that only has “price × volume − COGS” will miss the box as a fixed-cost machine.
Exhibits you should expect
| Exhibit | Meaning |
|---|---|
| Total sales vs comps | New space vs productivity of the old fleet. |
| Four-wall P&L (sales, COGS, occupancy, labor, other) | A store can be “busy” and four-wall negative. |
| Sales per square foot / per labor hour | Productivity. |
| Shrink and returns | Especially apparel and omnichannel. |
| Cohort of new stores by vintage | Year-1 stores are not mature comps. |
Units that trip people
Comps (same-store sales) vs total sales. Total sales +4.6% with comps −3.2% is a new-store story, often a bad one.
Four-wall vs company P&L. HQ and DC costs are real but should not be dumped into a closure model without asking which costs actually go away (they often do not).
Traffic vs ticket vs mix. “Sales down” must split.
Digital GMV vs net. Returns and marketplace take rates (if any) belong in the retail P&L, not in a fintech GMV slide.
Practice a retail comps case
Run a scored case where headline growth and comps disagree, and four-wall has to decide the store.
Worked mini-case: twelve new stores, negative four-wall
Prompt. Trail & Keep has 140 stores. Comps −3.2%. Twelve new stores added 8% to chain sales; headline sales +4.6% (case narrative). Each new store: $4.2m sales, COGS 62%, occupancy $1.1m, labor $1.4m, other four-wall $0.25m. Ignore HQ. Should they keep opening 12/year?
Math. Gross profit per new store = 4.2 × 0.38 = $1.596m. Four-wall after occupancy, labor, other = 1.596 − 1.1 − 1.4 − 0.25 = −$1.154m per store. Twelve stores: −$13.8m four-wall. They bought headline growth with a profit hole.
Meanwhile comps −3.2% on the core fleet is the operational fire. If core sales were, interview-style, $420m (140 × $3.0m, a stated assumption), 3.2% is **$13.4m** of lost sales, or ~$5.1m lost gross profit at 38% — same order of magnitude as the new-store bleed, and it compounds.
Recommendation. Freeze the prototype. Fix comps (traffic: conversion and labor hours; ticket: mix and attach; occupancy: close the bottom decile). Re-open a smaller format only when a pro forma four-wall clears a hurdle after year-2 maturity, not year-1. Risk: e-com is stealing the new stores’ trade areas (cannibalization); ask for trade-area overlap. Next exhibit: four-wall for new vs mature vs bottom-decile stores.
What a generic profitability tree misses here
- Volume is not one number. Comps vs new vs digital vs wholesale.
- Occupancy is a step cost per box; it does not scale down with a 3% sales miss until you close the store.
- Labor is hours × rate × productivity, not “SG&A.”
- Cannibalization between new stores, old stores, and .com.
- Returns and omnichannel sit in the four-wall if you pick from stores.
If you treat Trail & Keep like a CPG brand, you will talk sell-in. If you treat it like real estate, you will quote cap rates on stores the retailer leases. The case is comps vs new space.
See where you stand on a retail case
Practice comps vs total sales and four-wall math.
Related guides
- Consumer goods case interview
- Marketing case interview
- Real estate case interview
- Profitability framework
CoachNed is independent and unaffiliated with McKinsey, BCG, Bain, or other firms named for interview-style practice. Cases on CoachNed are AI-simulated.