I went with a population-based breakdown, splitting the US into urban, suburban, and rural buckets and working from there.
Break the problem into a demand-side estimate: start with the US population, estimate the number of motel stays per night, and divide by the average occupancy per motel. Alternatively, use a supply-side approach by segmenting motels by location type (highway, urban, rural) and estimating counts based on known chains and independent operators.
Pro tip: State your assumptions clearly and round numbers to simplify calculations; the interviewer cares more about your logical structure than the exact final number. Also, mention that you'd validate with a top-down check (e.g., total hotel rooms in the US) to ensure your estimate is in the right ballpark.
Define what counts as a 'motel' (e.g., roadside lodging with exterior corridors, typically low-rise) and whether to include chains like Motel 6 or only independent ones. Ask if the estimate should be for a specific year or current.
Decide between demand-side (population-based) or supply-side (location-based) estimation. For a quick estimate, demand-side is often simpler: estimate nightly motel demand and divide by average occupancy per motel.
Start with US population (~330M). Estimate the number of people who stay in motels per night: consider travelers, truckers, and budget travelers. For example, assume 1% of population stays in a motel on any given night (3.3M).
Estimate average occupancy per motel: assume 50 rooms per motel and 60% occupancy, so ~30 rooms occupied per night. Divide total demand by this to get number of motels: 3.3M / 30 = 110,000 motels.
Cross-check with known data: there are about 50,000 hotels in the US, and motels are a subset. If your estimate seems high, adjust assumptions (e.g., lower % of population staying in motels).
AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.