Yeah I had that in the first weeks as well. However, you must tie your values and settle for the best combination to optimize your net profit. The company operations run parallel to those of actual athletic footwear companies. Does it hurt any other factors? Play with your numbers around and tweak them to generate maximum net profit. And I would not build another plant, rather increase capacity in the plants that you already built. The closer your actual numbers are to your estimates, the more likely it will be that you earn bonus points from the Bulls Eye Award (be within a 5% range of the estimates). You almost can never have enough capacity because what you dont sell in branded, you can sell in private label and dumb prices there and take away your competitors market share. For this reason, you and your team members need to start the BSG by spending more time analyzing the results of each year to figure out the best effective strategies to lay for the next round of the game. With the high-quality shoes + low model strategy, the only thing you care about is your PROFIT. (Im adjusting for Y13 now). Is it too late to reduce that to 50 as you suggested in your recommendation? Cost of pair sold, Ware house expenses, Marketing expenses, and Administrative expenses, all the 4 key contribute to Operation Cost. Should I decrease the pay dividends and do stock repurchase in Y13? Same with all the other values, like I described in my blog post And then use all your remaining shoes for the private label market. If you see little action on the celebrity market, go ahead and get your celebrities for the lowest price possible ($500). Moreover, you can benefit from Business strategy game help where professional BSG players have many years of experience. Otherwise you will not sell any shoe either. Or you have read it but still do not know what strategy to pursue or what is going on? Hi Dennis. Examples, Strategy and Warehousing - Supply Chain Brief While your regional sales volume for the internet segment is a good estimate, the estimates for the wholesale segments are not. Another important indicator of profitability is the return on equity (ROE). Hello, thanks for the great strategy, it is working (1st place) ! Moreover, the key is a rational debate with a compromise for everyone to understand why the decision is taken and commit to make it a success. Warehouse and Distribution Plan Strategies Advantage of this is, that you dont have to pay too much attention to your competitors. While you already have a good estimate of how many shoes you are going to sell in each region, you still need to consider your rejected pairs during production. Select +2% for the Percent Change in Competitive Impact of All Other Factors from Previous Year. It almost worked TOO WELL. We need to look at bottom line to see Cost of Pairs available for Sales. In the later years, when the cost in NA is high, we have built a new factory in LA, we can ship from LA to NA (eg. Should you consider selling a factory, dont upgrade it because you will lose that investment. What is Warehouse Management? Benefits, Processes, & Strategies Now you begin to understand why I earlier said, that if you use overtime for branded production, you should expand your plant capacity for the next year. Over Year from 15 to 18, ROE changes up and down 22.5, 18.2 then 20.0 then in year 17 down to 16.8 then up to 24.3 in Year 18. You dont have to care about your retail outlets anymore so adjust the price so maximize your net profit, without the 40% rule. Most players play hard from the first round, thus increasing S/Q, the number of models, reduce the price, putting for advertisement three times higher than average, and bidding for celebrities. This decision page is mainly a waste of money and we will not spend a lot of time with this page. We need to control this better in next five years. We do not leave it in bank or safe. The Business Strategy Game is a hands on learning exercise that will give The Students valuable decision-making practice and develop powers of business judgment. However, my net profit is still negative even after i have adjusted the private-label. With increased competition, prices tend to decrease. Plant Capacity / Upgrades. The issues depend on cost of production. Yes, its not too late yet to follow through with my tips. Sounds good, congrats! my advice would be to read my guide and follow the steps. Models Available weighted average Wholesale Wholesale Price to Retailers span Marketing Brand Advertising (5000 Decisions Mail-in Rebate 9 to $15 por part Delivery Time (1 to 4 wek delivery Retailer Support (50 to $10000 Retail Outlets witing to cry your brand Marketing variables de termined by prior year Celebrity Appeal am creeper Whenever you change and sharpen any decisions, you should keep track of your net profits. The Business Strategy Game or BSG is a simulation game used by, different colleges for their Business capstone. To do so, first plug in your N.A. Working Conditions Improved Ventilation, Lighting, and Safety Continue Involves one-time capital investment of $3.0 million and increased administrative costs of $500k annualy per facility. This is why building additional capacity is so important. So for the last year I didnt stick to the rule that the internet price has to be 40% higher than the wholesale price. However, if you need a few points for the image, consider using the Corporate Citizenship but take note of the expenses. Students use the BSG to cultivate managerial skills for decision-making purposes. It sometimes works. Profit is the key to success in this game! Same for your superior material. I am on my second year and I have negative income right now, any tips on how to get in the positive? As always, do not forget to save your decisions after you are done. First, set your Number of Models to 50, as determined earlier at the Sales Forecast page. This Branded Distribution table of decisions seem to need more time. This is a good lesson in class that can be valuable in life. ROE indicates how much profit is generated with the investments that shareholders made. However, with a reasonable price. we are having a horrible time of having left over inventory .. we are in year 13 and our numbers are ok we were 1st place last on year 11 and second place on year 12 but i having a feeling we have been focusing so much on our current numbers we arent going to end well any advise on what we should do on inventory and other sections of the game.