Nonetheless, learning from your and other groups failures is also necessary. Thank you so much! Best-Strategy Invitational High-performing companies worldwide face off in a 2-week competition hosted 3 times a year by the BSG author team. I did not stock issues or issue purchase in the those years. Sure, you can ask anytime An ingenious business strategy for your team will help your team members to appreciate the significance of the strategy, identify the kinds of trade-offs needed, and demonstrating that with limited resources, not every project can be pursued. The Business Strategy Game is an online exercise where class members are divided into teams and assigned the task of running an athletic footwear company in head-to-head competition against companies managed by other class members. However, I would recommend not taking out any loan if possible. For example, a WMS can: You want to setEthics Training / Enforcement to All Employees and Workforce Diversity Program to Yes. ? We have good market share in NA and, last year, we needed to ship the rest of the shoes from AP (incurring in shipping and tariffs costs, hence, the thought of adding capacity in LA). Optimizations are the last task you can do before finalizing each year. So when following the steps described above, you will have positive ending cash really soon again. Key Term business strategy game year 11 decisions; This preview shows page 1 - 2 out of 2 pages. With the high-quality shoes + low model strategy, the only thing you care about is your PROFIT. It can be very beneficial for you. From round 2, there is a risk that other groups can set the same strategy with the winner can be you. On this page, you will optimize your entries and toggle each value until your reach the maximum profit possible for each entry. Id also like to point out that it appears the developers threw out NAFTA in the new version, so tariffs hurt pretty bad in Latin America. Theres everything explained in detail. Over the next five years, G-Brand will pursue strategies that will help it improve its financial bottom line, especially ROE because the company has quite high Equity. If not, see what positive percentage yields the highest profit for you. 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 can be a very tricky decision and you need to analyze your competitors prices. I did not forget it, but we will take a look at it later. From this highest whole dollar amount, I plug in every possible value around it and find the price that yields the highest net profit. How can the company lead the market in 10 years? Keep track of total Net Profit to have enough money to build new factory, or we can always borrow to do so. The information is these guides is laid out, and displayed, in such a way that crucial decisions should be a breeze. We also regularly pay old loans to get higher Credit Rating. But it is definitely worth it. Concerning changing others values, I recommend reading my initial post where I have explained everything in detail. This decision page deals with your plants. . However, to be able to do so, you need available capacity. Total Admin Expenses is very low, just 1.49 per pair of shoes. Besides, you dont have to spend more on high-quality materials. This way, it becomes a living guide for decision-making for the entire company. What is the companys differentiation strategy? My direct competitor is now selling 8 stars with more than 400 models in wholesale so I think i will be at a even better position selling 50 models. I worried that another team would have stumbled onto your blog, but few people Google tips it seems! Right now I am doing the second year decision, Im doing star 8 and 100 models, did 7 stars and 100 models in first round and the result was not very good. Any advice? NEVER do this. Cost of pair sold, Ware house expenses, Marketing expenses, and Administrative expenses, all the 4 key contribute to Operation Cost. I will explain soon, how to increase plant capacity and why we need the capacity for private label. Hi, Im glad to hear that it helped! (meaning I decreases it from $1.00 to $0.15). Keep in mind that you are managing a multi-national company, and shareholders are not interested in dividends but the stock price. This is why building additional capacity is so important. However, with a reasonable price. Another important indicator of profitability is the return on equity (ROE). The BSG tends to underestimate those values by about 20% and hence, you need to correct them for a more precise estimate. Do not sit on it. Hi Dennis. They have all changed by +2%, just as you plugged it in. Then, just like you did before, plug in different values for your internet price and see, which price yields the highest net profit. The following tips can help you get around the BSG and possibly be the winner. Hi! Company operations parallel those of actual athletic footwear companies. Unlock this data. This support strategy of expansion and getting high Sales, Higher Net Profit and higher market shares. Should I continue expanding NA or AP and by how much? Key pharmaceutical distribution warehouse questions to ask a 3PL. The company operations run parallel to those of actual athletic footwear companies. If you have more cash available, go ahead and spend it for either one of the other options. Thank you in advance! I now have another question about capacity. We will differentiate prices to allow our shoes to be reasonable priced to the average personal. Its not too bad, no worries. Do not focus too much on the market share but focus more on profits. It is all about trying out all possible combinations. This can get confusing at the beginning so here is a table to show you the process. We will adjust collection online lower to 400 compared with 500 in stores. The cost of the game varies depending on the version and the number of players, but typically ranges from $50 to $100. However, there are still some other voluntary decision that will prepare you for future decisions. As such, you can play the game frequently, any time you get it interesting. Like should I add up all my wholesale prices from the 4 regions and then divide by 4 to get an average wholesale price and multiply by 1.40 to get the internet price or should I base it off the lowest wholesale and then multiply by 1.40 to get the internet price? Five ways that warehouse strategy can benefit your business include: Inventory Management Accuracy Price Stabilizing Tools Technology for Packing & Processing Locations that Meet Your Needs Outsourcing to Fulfillment Services After you have done this, you repeat the same procedure for Europe-Africa and Asia-Pacific with the A-P plant because it is cheapest to ship shoes from A-P to E-A. We were actually thinking on building capacity in LA for next year, however, two of the other teams already built capacity for 6,000 pairs in total (we are only 4 teams in total). Moreover, this may be a lesson in the real world of business as everything comes with quality, models, and price. Advantage of this is, that you dont have to pay too much attention to your competitors. BSG Guide - How to Win the Business Strategy Game.pdf. if you have left over inventory, you should either work on your numbers as I described in my post or put the left-over shoes into private-label. However, you must tie your values and settle for the best combination to optimize your net profit. With respect to our employees well-being, our G-Brand Company intends is to continue its practices of investing in employee-development and utilize a compensation model that encourages our employees to work hard, while simultaneously striving to be more productive and efficient. The Strategy Business Game learned all aspects such as production, distribution, sales forecasting, finance, marketing, celebrity endorsements, private label operations, corporate . To do so, first plug in your N.A. Hence, find the combination that gives you the highest profit. Percentage of Superior Materials, Number of Models, Enhanced Styling / Features, TQM / Six Sigma Quality Program, and Best Practices Training all affect the S/Q Rating. With the Business Strategy Game, teams of students run an athletic footwear company in head-to-head competition against companies run by other class members.Company co-managers must make decisions relating to plant operations, distribution and warehouse operations, work force compensation, online sales at the company's web site, sales and marketing, and finance. You now need the forecasted Regional Sales Volume for both the Internet Segments and Wholesale Segments in all four regions that you wrote down earlier. You should pay attention that your S/Q Rating of Branded Pairs Produced matches your value on the Sales Forecast page. I cannot make any money there. You can still ship pairs from LA to somewhere else if needed. However, traditional warehouse management systems are not designed with the flexibility or technology capacities to address ongoing challenges in the . We are doing very well, even up and down from 1st and 2nd position but we have a strong and clear visions for future strategy to lead the company at top of market and meet Investor Expectations. Before you even start plugging in any numbers, it is important that you decide for a strategy to pursue for the game. and A-P plant, focus on your Total Branded Production Needed to Achieve Year XX Sales Forecast section on the lower half of the page. . If this is still not enough, add the missing shoes to the other plants Branded Pairs to be Manufactured in Year XX number. Study on the go. Let me know if you have any more questions. With our strategy, you might want to think about getting Option A as well. That is regardless of the low price, high quality, or variety of models. However, do not forget to calculate your possible additional expenses for your celebrities. However, it will also decrease your ending cash. Use the remaining 30% capacity to sell shows in private-label! Authorize your construction and you save your decisions. Start off with the values that you know for sure: For the high quality, low models strategy, I recommend starting off with a S/Q rating of 7 stars and 50 models available. It has to find ways expand so that cost of production at high quality still low enough to increase high margin, high market share and getting over all high Net Profit. If you have any questions, feel free to come back and ask them. You will also receive a copy of Currency Made Simple. But this year I have a lot of cash on hand, I upgraded my plant, should I also build the LA plant although I dont need that much capacity at the moment? G-Brand has been performing for many years Higher than Investors Expectation. And you said I should only add capacity onto existing ones instead of building a new one in LA right? So I doubt on his strategy. Besides, you can lower the cost per pair of shoes. Hi Lee, After you have calculated the manufacturing volume for each region, add up your N.A. When evaluating the 3PL provider in charge of your pharmaceutical distribution warehouse, safety is the name of the game. Hi, youre welcome. I mainly looked at what they were doing in the private label sector. When we do so, look at estimations to keep control of ROE and EPS. This is because your competitors are adjusting and trying to find their strategy. In the first few years, this will be pretty difficult to determine. Profit is crucial in the BSG game. Therefore, ensure your profit increases after every round to make the game better and for real business. Net Profit of 150 million with increase of 25% every year. This Branded Distribution table of decisions seem to need more time. 11/4/2016 1/2 I . I recommend increasing capacity and keep focusing on your profits. If you tweak those numbers, your demand will adjust accordingly. But again, thanks! While your regional sales volume for the internet segment is a good estimate, the estimates for the wholesale segments are not. You are now all set to dominate your industry and win the BSG! 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). (Darius White) The business strategy was a very practical and real-world experience of what it is like to run a major corporation and the rigor it takes to increase earnings per share, return on equity, credit and image rating. After that, loot to the left of screen to check if we have high Net Profit. When doing so, you have to plug in numbers for the assumptions section in the new window. You might think that using green footwear materials or using recycled boxing / packaging is a good decision, especially with the currently ongoing environmental debates. In this blog post, I will run you through everything important that you have to know about the BSG and how to win it. We have never looked in very details of business management like sales margins or even a few percent of market shares. On this page, you will set your values for your branded production. so idk what i may have done LOL, Hello, may I ask my is not that great at the moment and we are onto year 13 which is like 2nd year maybe of the game and i try my best to like follow your tips though not as fully cause I still dont understand much especially the calculation one a bit confusing cause I am bad at that, so far I have 7 s/q rating though I am unsure should I do lower models or not cause I am afraid it might not be enough for profit and all because most I see at average of rating and high models , I was wondering what can I do to make it better? You can ignore the Internet Marketing and Wholesale Marketing pages because they will just reflect your internet and wholesale decisions that you already plugged in on the previous pages. I would recommend purchasing the upgrade for both of your plants within the first four years. ROE indicates how much profit is generated with the investments that shareholders made. Optimizing your values is the essence of the game, even though it might be very time-consuming. How can the company overcome tough competitors who seem to know most of the things you know? What are the core competitive advantages? In todays education system, developing students with a high level of competencies and capabilities is a challenging task for every instructor. Quiz 2 Chapters 1 an 2.docx. The styles or features can be at 50, while the TQM can be set at 2.50. We aim to increase market share through factories in three continents, NA, AP and LA. We also learn a lot from the BSG itself and from our class mates, other teams, even we compete in the games, but in order to run effectively, we have to look at our competitors to learn their strategies and we see what they did well or not very well, we learn by doing this. The Business Strategy Game Player's Guide 2 Welcome to the Online Edition of The Business Strategy Game. I was thinking about building a LA plant because I took the majority of private label there last year. Strategies, decision screens, reports and tests. Thats one of the things you should never do because you can always use capacity. I wish you the best of luck for your game. Its not too late to do that yet. Regardless of what the other competitors do in Year 11, your focus should be winning. The information is these guides is laid out, and displayed, in such a way that crucial decisions should be a breeze. The issues depend on cost of production. This is the key to affect our strategy in the next five years. For this blog post, I will concentrate on the high-quality + low model strategy. Again, try out each percentage for each region and set it to the percentage that yields the highest profits. You will not have any complaints about the quality of the assignments we deliver. This essay was written by a fellow student. Currently, were selling 150 models. The world's most streamed artist Bad Bunny, a Puerto Rican rapper, alone claims 8.3 billion streams. All footwear With the high-quality shoes + low model strategy, the only thing you care about is your PROFIT. At Top Academic Writers, we have writers with experience in different fields be it in high school, college or university. I am so thankful for your post!!!!!!!!!!!! Definitely helps! And he also purchase 4000 capacity in the first year but no advertising expenses. When contracting a celebrity, your advertising efforts in the Sales Forecast section should not be low. The most important advice in advance: it is all about PROFIT. 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. Also, we are doing better than in the past so interest rate is lower. This means, you have a channel conflict, meaning that your Retail Outlets number will decrease in the next year and less retailers are willing to sell your shoes. Also, consider workforce diversity and ethics training. If you are completely new and your projected performance box is not showing yet, you have to click the Save Decisions button on the upper right-hand corner for the projected performance box to appear. (In Y11, I did the 5-year loan with 12,000k (7% interest). Hi. We will keep the largest market shares in Internet Sales. Now, decide to which region you want to ship your private-label shoes. Yes, despite your competitors building capacity as well, I recommend increasing capacity in a reasonable amount. Hence, you will only focus on the two following decisions that are worth their money as they increase your image rating the most. The Business Strategy Game (BSG) comes in handy as a realistic representation of the actual practices in a virtual setup. For only $35, get instant access to the Business Strategy Game Guide. I would like to ask about the Pay Dividends. My stupidness did not know that I should not pay dividends while Im in LOAN mode. Find out how much you want to bid for each celebrity. honestly i started with 150 models at 6 stars and went to 200 and 7 stars, 8 in private label. Several colleges and universities use the Business Strategy Game in teaching and learning strategic management at their schools of Business Management. It typically keeps increasing until a certain price point and then starts to drop. Do that by answering the following questions? We even understand the very details such as marketing per pair of shoes, cost of warehouse, administration per pair of shoes, which can contribute to the total cost making the Net Profit higher or lower then decide the Business Results and overall market development. Higher Net Profit is a key to win the BSG Online Game. Looking at the North America column, you now have to plug in your values for Wholesale Price, S/Q Rating, Models Available, etc. Celebrities will enhance your marketing efforts and help you sell more shoes. Here is a chart again tho show you the process: If your regular production capacity is not sufficient, use overtime. Can you tell us more about the strategy you had ? 3/29/2021 BSG Decisions & Reports Projected Year 12 Performance Scoring Measures EPS (earnings per . Try and set it to Yes. Should you win, it would mean your tips are more favorable, and your competitors may learn from you. We give you. G Brand has a Vision to establish a worldwide brand dedicated to innovative design and best provider in quality at reasonable prices, allow becoming a global leader in the athletic branded shoe market. You can decide to sell or purchase available capacity, upgrade your plants, build new plants in other regions, or add capacity to already existing plants. However, if you happen to use overtime at either of the two plants, plan on increasing the plants capacity in this decision round. View Distribution & Warehouse.pdf from MGMT 5355 at Texas A&M University, Corpus Christi. Otherwise, their endorsement effect declines. Is it too late to reduce that to 50 as you suggested in your recommendation? One of the most useful skills we learnt from BSG in Financial Analysis, we have had the chance to read Income Statement and Financial Reports every years, for last 8 years, many time, which we understand more about cost and revenues, details of cost, details of revenue, we notice the importance of loans, interest rate, credit ratings. We will keep Expansion of Internet Sales, keep low-cost-strategy with Highest Values that customers can get Online. Otherwise you will not sell any shoe either. If your team faces these kinds of challenges, seeking BSG help online could be the best option. Try out each and every value and note down the highest net profit values. Because with more capacity, you can offer more pairs in private label and dominate the market there. You can also win if you settle for Mid quality and a High number of models. I would always encourage you to bid on available celebrities. And I would not build another plant, rather increase capacity in the plants that you already built. 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. The end result counts. Is your strategy also works for my situation? On this decision page, you can bid on celebrities. Whenever you change and sharpen any decisions, you should keep track of your net profits. When I played the game, I barely looked at what my competitors were doing. In this section, you can upgrade your plants. I would then adjust the Percentage of Superior Materials to whatever is needed to match my S/Q Rating with the value plugged in on the Sales Forecast page. You dont have to care about your retail outlets anymore so adjust the price so maximize your net profit, without the 40% rule. Please delete one if there is an extra comment. Tips: We ship from NA to LA because no import tax or tariffs due to NAFTA (North American Free Trade Agreements) - The North American Free Trade Agreement, or NAFTA, is a three-country accord negotiated by . The most crucial thing is the find out what prices your competitors have. PS: I do the 5-year-loan 12,000k in Y11 (7% interest); In year 12, I paid #1 Long-Term (early payment) 12k at 8.2% AND borrow 70,000k 5-year-loan at 4.5%. However, keep track of profit since you are cutting from the profit for PR products. In the Private-Label Production field, use all your remaining available capacity, even overtime. Although we are still ranked 8th in the world and 1st in the. In the above example, we ship from NA factories to NA and LA. Copyright 2023 | Powered by Top Academic Writers, Automated page speed optimizations for fast site performance, Leadership and Management Assignment Help. It almost worked TOO WELL. They do their best to ensure that you get the best grades on your assignment. I would like to ask you about the Dividends. We will get ROE higher soon, and faster than other competitors. Logistics strategy as an enabler of new business models. Like I explained in my blog post, do everything that is necessary to increase and maximize your net profits. Do you know why is that? We need to control this better in next five years. Our EPS increase fast from 7.36. It depends on how much private label you sell and whether you want and can sell more depending on the market, whether its satisfied or not. and L.A. volumes and finally plug them into the NA manufacturing slot. It is quite simple. You will get the hang of it after the first few decision rounds as it is always the same procedure. You can do this by checking the bid prices for the previous year. Do not worry about those numbers, they will just show you whether your investment is profitable or not. Build new factory in LA and upgrade to C and one more, may be D. Keep NA and LA for controlling Private Label, this year will also requires high S/Q so we have good advantages. We note to see Return on Equity, so keep Total Equity lower than increase Ratio of Net Profit. We will upgrade AP in C and one other option. Thanks a lot! That combined will give you a good boost for the last year. Hence, try to keep your internet price at least 40% higher than your wholesale price. Fin. Now, I am worried about the future rounds. A warehouse management system (WMS) is a software solution that aims to simplify the complexity of managing a warehouse. Once you get the Main Menu for running the company, print a copy of the Year 10 company reports, a summary of the footwear industry report for year 10, and competitive intelligence reports. Try out different combinations that keep you at 8* and the highest possible net profit. It is definitely around 1.2 though and I recommend starting off with this value. You can know your strategy in several ways. It is important to toggle your values and find the best combination to maximize your net profit. So for the last year I didnt stick to the rule that the internet price has to be 40% higher than the wholesale price. So, play around and find the best combination for your given S/Q rating that yields the highest net profit. Students use the BSG to cultivate managerial skills for decision-making purposes. These three strategies can help. Do this for all four regions. If it is lower than 40%, your wholesale price will be in competition with your internet price. If you really need money, I would rather advise you to issue some of your stock. Download the iOS You need the capacity for the private label market. Paying off these loans in advance has the advantage that you will pay less interest over the coming years. havr the highest stock price, image rating at 90, A+ still, and double digit EPS. We need to adjust the number of productions to optimal these decisions. Hi! Even more important is, to stick to it! View Adopters Arthur A. Thompson, Jr. John R. Miller Professor Emeritus Check the Competitive Intelligent Report. We can check that before making decisions. However, when pricing your shoes, keep in mind to set the price at least $5 below the wholesale price average. You can either take out a 1-year, 5-year, or 10-year bank loan. Texas A&M University, Corpus Christi. For the upgrade option C is the one to raise 1 star, but the actual cost it can save me every year is not a lot, should I still do that? I will talk about the Celebrity Endorsements page later. Do this for all the four regions. However, the private-label market is set up the way that only a limited demand is given each year. Also, G-Brand need to keep high market shares, year 17 market shares are reduced, but G-Brand has get back to Top in Year 18. This game can be overwhelming, so anything to help other players! Hi Yvonne. However, if done right, it is worth the time as it will yield the maximum profit possible and success in your industry. or A-P plant. In the first year (Year 11), you only have two factories, and you need to distribute to four markets. Set your price to whatever maximizes your profits. Company operations parallel those of actual athletic footwear companies. In 2020 digital game sales outpaced physical sales for the first time. We will now look at all the decisions you have to make to actually play the game and be successful with your strategy. Hi You have to base it off the HIGHEST wholesale price, just to be safe Like that, all 4 regions are guaranteed to be 40% above wholesale price. Beat the Business Strategy Game. If you see little action on the celebrity market, go ahead and get your celebrities for the lowest price possible ($500). Also, we can upgrade NA in C and one other option. I dont understand why it did this as this capacity was unused and there was upside to having it as my production was max out for the demand. How to solves this situation ,have you given us any suggestion. I would definitely increase your S/Q rating to 8* and lower your models to 50 (this should be the lowest you can go if I remember correctly). Do I need to change another setting on another page for this to remain positive? I am in a box where every move I make to lower cost or shift production lowers my EPS or credit rating. 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. I hope that helps and good luck! G-Brand continue to be a good steward of the environment and social responsibility. you should repurchase stock whenever you can. For instance, you can change the Industry Average to +2% or +4% to attain the optimal. Does it hurt any other factors? Theres not right amount of capacity you should purchase. What I like about my strategy is that you do not necessarily have to keep an eye on your competitors. This can make Net profit quite simple, if we produce 12.000.000 pair of shoes, we will get about 144 million Net Profit. Learn how your comment data is processed. More effective. Yes, I would definitely do plant upgrade option C! I am on my second year and I have negative income right now, any tips on how to get in the positive? To this point, you are set to dominate your industry and win the Business Strategy game. This site uses Akismet to reduce spam. View full document. We can keep and sell NA after year 16 if we have good and large LA factory. The Business Strategy Game is a simulation game that allows players to experience the complexities of running a business. You are almost done for the Sales Forecast decision page. My stupidness did not know that I should not pay dividends when I am in 5-year-loan, so I did not adjust any part in Finance Cash Flow except for borrowing. And Im so thankful for your post!!!!!!!! We are doing well, so Stock Price is high too, over 120, we will buy back some with extra money, cash in hand of G-Brand will be over 150 million every years. At the end, I increased dividends to boost my ROE. Play with your numbers around and tweak them to generate maximum net profit. Graduates are expected to possess broad competencies like problem-solving, critical thinking, and cognitive skills when entering the job market. It is best to build only as much capacity as you can afford without taking any loans.