BSG Game Tips – Net Profit Or Cash in the Bank?

In the Business Strategy Game  there are a large host of people who wonder if whether it is better to sacrifice net profit for a large cash reserve or to deplete a cash reserve for the sake of a slightly higher net profit.

The answer to the question is extremely critical for anyone who wishes to win the game on bsg-online. A large cash reserve and no debt is able to raise your credit rating to a very high level and you’re able to get points. Whereas having a good net profit raises EPS, RoE, and stock price (to a lesser extent). Ultimately it is far more worthwhile to have a higher net profit than a large cash reserve.

This question can evolve is that is it better to have a high net profit at the expense of great debt? In my experience as a BSG Grand Champion, I've learned that it is better to see your company loaded with debt to create a high net profit than be a blue chip “no debt” company with mediocre profits. Too many people believe that having no debt is this awe inspiring feat.

In Finance class you will probably learn that debt is a financial lever. Using debt to bolster your company with greater abilities leads to greater net profit which in turn pays off the debt in time. A company does not need to be debt free to be extremely successful and capable of an A+ credit rating in the industry.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more tips on how to Win Business Strategy Game and The Glo-Bus Simulation Game go to www.bsgtips.com

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Winning the Business Strategy Game – The Celebrity Mistake

In all the games I've seen, oftentimes a company won’t think one of the most overrated aspects of the business strategy game that wins. And that is celebrities.

Celebrities for a fixed cost, give a boost to the desirability to your shoes. Most people think really materialistically when they think of celebrities and want them to promote their shoes. Celebrities are known for getting outrageous amounts of money and therefore in the first year, people put up insane bids without even thinking. When I say insane I mean over $10,000, I've seen people max it out at $50,000. Thinking of it logically, if you are starting a new game, your company sees a net profit of about $30,000 a year. So to bid anything above $10,000, you are basically throwing away your net profits. Most companies put themselves in a bad start by bidding way too high for celebrities.

Realistically, your celebrity bids are $1000-$3000 to put you in the right direction. A game can be won without celebrities.

Celebrities though can be a strategy in themselves. A mid game company that has all the celebrities for possibly $5000 on average has stifled his competition who has no celebrities. This strategy is not a surefire winner, but it is a strategy that I have employed for a round.

Overall though, take celebrities with a grain of salt. Celebrities in the game don’t have enough clout singly to win business strategy game.  In the end it is your product that will make or break you.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help and The Glo-Bus Simulation Game go to www.bsgtips.com Business Strategy Game

BSG Tips – How Much Capacity Should My Company Have?

This is a common question in the first year as companies strive to be the first in the industry and win business strategy game  A very simple concept to imagine is that by being the biggest company you will be successful, and therefore people expand by enormous amounts and putting their company into significant debt in the first year.

The concept of a lot of capacity wins has truth to it, as usually the company with the biggest capacity does win. But this does not mean that they are any smarter for it. Being the biggest company and losing to a smaller one is embarrassing and it happens if the company isn’t skillfully managed.

A company that is overaggressive and overexpands to the limit will definitely put itself in financial straits immediately. Krispy Kreme doughnuts is such a company that overexpanded beyond their management skills and they paid dearly for it. There is a market for doughnuts for sure, and Tim Hortons skillfully expanded in a way that Krispy Kreme did not.

Especially in an industry where everyone overexpands and the market crashes with oversupply, it is the few companies who did not expand and wisely choose to advance their company the second year. Therefore it is best to hedge your bet between the long term goal of being the big company and putting yourself in a bad spot in the second year to limit your plant capacity in the first year if you really want to win the business strategy game.

View capacity as a weapon, and the bigger it is, the harder you can hit the other companies. But if you can’t lift it or skillfully wield such a great weapon, someone else who is more astute with smaller capacity can humble your company quickly.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help and The Glo-Bus Simulation Game go to www.bsgtips.com Business Strategy Game

Business Strategy Game Tips – Which Market Should I Be in and Should Production Be There?

This is a commonly asked question in which market to be in by many people who plan to do “niche marketing” and plan to dominate certain market segments to win. The trick of the game is not to get hung up on focusing on one market, as that limits you.

In the real world, Pepsi and Coke fight for dominance in the soft drink industry. Pepsi focused upon North America and therefore has the huge advantage in this part of the world. Coke’s strategy is different, they went into several countries and tried to carve out a market share everywhere. It is because of this Coke is the greater corporation internationally while Pepsi is the greater corporation domestically. In terms of risk and just overall greater success, it is because of Coke’s greater global coverage over Pepsi that makes it a less risky and more profitable company.

So to bring it back to Business Strategy Game or BSG terms, you need to compete in every single market competitively if you want to do very well. Make sure you are taking your respective piece of the market share in each area and a little more if you can. The profits of controlling the industry will help you win the business strategy game.
While being in every market is a goal of a successful multinational company. This is also linked to having production facilities in that market to support it. As a company wants to be in every market, it will be important to choose a factory that supports it. Having a European plant is a strategic move that is not often chosen by companies because it is not realistic to have the European plant produce shoes for many of the regions. But having a European plant does serve immense uses when it builds shoes for the European market. The slogan for international business is “think global, act local”, and in winning the business strategy game, that becomes true when a company builds specific factories for specific markets.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help that teaches how to Win Business Strategy Game and The Glo-Bus Simulation Game go to www.bsgtips.com

Business Strategy Game Quiz Answers (BSG Quiz Answers, BSG Chapter Quiz Answers)

Most Business Strategy Game and Glo-Bus classes have quizzes separated in difficulty known as “BSG Quiz 1″ and BSG Quiz 2″ or “Glo-Bus Quiz 1″ and “Glo-Bus Quiz 2″. The quizzes have many in game questions relating to the rules, and some questions can be very difficult. Especially in BSG/Glo-Bus Quiz 2, the answers will need to be solved using basic business knowledge. Here is an example of a question in BSG/Glo-Bus Quiz 2.
Given the following exchange rate changes: (Note currencies may be different in Glo-Bus)
Year 1 Year 2
Euros (EUR) per US$ 0.8230 0.8165
Sing$ per Brazilian real 0.5860 0.5710
Brazilian real per euro (EUR) 3.7030 3.7180
US$ per Sing$ 0.5940 0.5980
Then, as explained on the Help screen for the Branded Sales Report, it follows that:
* The euro has grown weaker versus the US$.
* The Brazilian real has grown stronger against the Sing$.
* The Brazilian real has grown stronger versus the euro.
* The euro has grown stronger against the US$.
* The US$ has grown stronger versus the Sing$.
This is how you answer this question. If year 1 values are lower than year 2, that means it takes more money to purchase another currency in the present year. Or in effect, that the currency will grow weaker.
If year 1 is higher than year 2, that means it takes less money to purchase another currency. Or in effect, that the currency will grow stronger.
So let’s deduce which one is the right answer.
“The euro will grow weaker versus the US$.”
This can not be right, as the numbers have gotten smaller in the second year, which actually means the currency has gotten bigger.
“The Brazilian real will grow stronger against the Sing$.”
As the second number has gotten smaller that means the currency has gotten stronger. But the currency in question is the Sing being stronger, and the words are reversed in this answer. This answer is wrong.
“The Brazilian real will grow stronger versus the euro.”
The second number is larger than the first, which means that the currency has gotten weaker. Another wrong one.
“The euro will grow stronger against the US$.”
By deducing the first answer, it made this answer automatically right. As the first number is higher than the second, which means the currency has gotten stronger.
“The US$ will grow stronger versus the Sing$.”
As the second number has gotten bigger, this means the currency has gotten weaker, and this answer is wrong.
Tough stuff eh? It’s not that hard if you walk away and come back to it. But this is how tricky the quiz can get.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help that teaches how to Win Business Strategy Game and The Glo-Bus Simulation Game go to www.bsgtips.com

Winning BSG Strategies

So today I was with my girlfriend and we were in a Luis Vuitton store (It was my first time). How my gf can buy a $500 purse and walk away with a smile, blows me away (talking to a guy who has been using the same old wallet for nearly 10 years).

As I was in the store and viewing the very, very expensive merchandise. I began randomly thinking of BSG lol. You see Luis Vuitton is effectively the low models, high quality strategy and effectively some people come into BSG aspiring to perform a certain strategy. This decision is led by ego, not business sense or practical knowledge. I have met many people who want to be the “Luis Vuitton”, and I personally won my first Business Strategy Game or BSG game utilizing this strategy years ago. I have also met people who wanted to be the price leader or the highly differentiated company. All these strategies have their merits, but it only gets sketchy when the Industry isn’t right for that particular strategy.

I have met companies who HAVE to do a certain strategy, they are not willing to adapt, and that is what BSG is about, having a baseline strategy, but adapting to the times. If you plan to win BSG, you need to be willing to change to the circumstances, that is a characteristic of a winning BSG strategy. If you keep holding onto a strategy and are unwilling to evolve, you must accept all the faults of that mindset.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help that teaches how to Win Business Strategy Game and The Glo-Bus Simulation Game go to www.bsgtips.com

Business Strategy Game

After playing hundreds of Business Strategy Game or BSG rounds, I’ve seen typically what usually happens to the average industry at each step of the game. There are several factors that can create highly profitable boom times and terrible recessions that make people go bankrupt. The greatest of these factors are exchange rates, industry capacity (and by default shoe supply) and Industry Competitor aggressiveness.

Usually at the start of a new game because of everyone’s newness and very rarely afterward is what I like to call “Soft”, “Good” or “Boom” Years. The overarching strategy of these types of years is to gather as much net profit as your company can absorb and make good use of the year’s opportunities.

These are the key factors to watch out for Boom Years. Positive exchange rates usually helps the whole industry improve. Good balance of supply and demand allow for a future of growth for smart minded companies. But the best of all… is when other companies just aren't very aggressive or don’t understand what they are doing which makes them ripe targets to DOMINATE!!!

It is from Boom Years that your company can really jump ahead and gain huge advantages over the competition that may secure future victories in tougher years. Unfortunately Boom Years can be very scarce and companies must usually contend with “Bad” Years or Recessions that make up the bulk of the game.
Although competitor aggressiveness may increase as the game continues and industry capacity may never be healthy again. Exchange rates sometimes act as a little financial oasis in the middle of a recession acting as a mini boom against adverse circumstances.

n the last article I covered Boom Times, how they are caused, and what to do in the event of one. Pure boom times are very rare in the game because usually there is one smart competitor in the industry who wants to be significantly stronger and better off than everyone else. When several of these competitors hold that mindset and have an idea on how to win BSG, they will ultimately create a very competitive and aggressive marketplace. This sets the platform for a recession as prices begin to drop as competition heightens and it only takes a few aggressive companies to greatly expand their factories to create oversupply in the industry. As these factors go against the remaining companies, the death knell to the industry when exchange rates turn into the negative, this is a surefire sign to expect most companies to drop in points. In the above circumstances only the strongest will survive the recession and for some companies dropping in points means never gong back.
But are recessions truly good or bad? It’s a fact of life for sure and this is something that has to be dealt with. In boom times companies are more “buoyant” and there is an upward tendency for the whole industry. In a recession companies are more opt to sink, and this downward tendency may be used as an advantage.
In my personal views on how to play a recession is that all the companies must prepare for a massive “onslaught” and everyone is going to get hit. All the companies raises their shields and defenses to protect themself, and those who get hit will fall back, and those who can maintain their position or possibly even advance will benefit. A recession acts as a force against everyone, and if you can hold your own, it pushes everyone else back and the net outcome is that your company’s position has actually improved.
Sometimes the greatest fortunes are made in recessions.

n the previous articles we’ve explained both boom times and recessions, how they are caused, and how you should play when they are in effect. Boom times are a time for great prosperity, while recessions opens the gateway to bankruptcy. But can the two be manipulated in a way that they both exist and even controlled?
In boom times your profits roar, but the question stands when and in recessions will your profits proportionally drop the same way the other companies The pinnacle of industry power is when you have the largest company and control a huge amount of the supply. All the customers want your shoes because you've created other strategic advantages such as celebrities, good advertising, and strong distribution lines to reinforce financial security. In the case of a recession where your company greatly controls 2/3 variables being supply and industry aggressiveness (as your company adds to that). It is possible to create a situation where you “ride the recession”.

The metaphor I like to use is that your company is on a surfboard  the recession is the wave, and your competitors are going to be hit by the wave. Like a surfer when they are on a crest, it looks almost as if they “control” the wave just like your company sort of “controls” the industry. The innate danger itself is very real and as long as you stand on top of it, you are effectively immune to whatever misfortune happens to those who are standing in the recession’s path.

Getting to this position creates a situation where everyone has next to zero net profits with a few market challengers being a little better, while your company is doing extremely well. It is possible to tame a recession to your favor and use the recession’s power to destroy your enemies. The real trick is understanding your industry well enough that you can create this situation without wiping out.

The Grand Champion of The Business Strategy Game and The Glo-Bus Simulation Game
For more Business Strategy Game Help that teaches how to Win Business Strategy Game and The Glo-Bus Simulation Game go to www.bsgtips.com