Average of opponents - If our company does X and if, on average, our rivals do Y

, and then we can reasonably expect to sell about Z pairs of shoes and achieve a
market share of S%, ROE of R,% and EPS of $EE.EE. It does not matter where you
are on the market map, what matters is how you fare in relation to the AVERAGE o
f your opponents.
Example - if everybody spends 1M dollars on marketing in North America, the gam
e treats that as if nobody has spent any money on marketing.
Unlike in the real world, you need to forget your views on business ethics, your
personal sustainability beliefs and views of what a corporation should be. In c
hess, there is no such thing as a cheap or unfair move. As long as you don t break
the rules of the game, it is all fair play. Only the numbers (inputs and output
s) matter.
Set your forecasts and then squeeze every additional penny out of the other scre
ens. The best way you can predict what the competition is doing is by filling ou
t the excel forecasting sheet. The more accurate your predictions, the more bonu
s points you will get and the more you will be able to rely on your entries on d
ifferent screens. The average shoe price and number of models are the most impor
tant entries on the sales forecast screen and it is extremely important you are
as accurate as possible.
Make sure your credit rating, EPS and ROE don t fall too much if prices end up bei
ng a dollar or so less than what you expected. Depending on where the market is,
it can be highly or barely sensitive to price changes and it is important to ma
ke sure you are protecting yourself from worst-case scenarios.
Sustainable competitive advantges:
1. Economies of scale - expand plant capacity - and thereby spread fixed costs
(celebrity, upgrades, marketing). Especially true in private sector label
2. Best distribution network - difficult to copy. Retailer support largely a fun
ction of market share. Retailers view the price as direct competition if it is l
ess than 40% above the wholesale price.
3. Good financial standing - lower interest rates
4. Best Practices & TQM / Six Sigma - useful with high SQ strategy
5. Celebrity endorsements - focus on getting long term celebrity endorsements
Strategy: Low SQ rating, High Models. It allows you to consistently get the high
est EPS, ROE and stock price. This strategy will allow you to continually max ou
t adding new capacity in Latin America and Asia Pacific and unload the extra cap
acity in the Private Label market.
Operations:
Purchase additional plant capacity for sale by other teams. (Do immediately afte
r the previous year s decision round ends)
Input all data into the sales forecast excel spreadsheet. Input data into the sa
les forecast decision entry screen. Don t concentrate on how your forecast
data will change your EPS, ROE, Credit Rating & Image Rating. You are trying to
predict accurate forecasts at this point, not maximize profit.
Try maximizing market share initially. Remember, only your final years scores ma
tter, so it is wise to take financial hits in the beginning of the game if they
will improve your positions later.
If you employ a high model strategy, your pricing can end up being very inelasti
c. It won t matter the price you sell it for, people will still buy your shoes. If
you employ a high model strategy, make sure to see what happens if you increase
your price every year to make sure you aren t losing out on additional revenue.

Leave some inventory at the end. Not a good strategy to sell out. One of the mos
t devastating things you can do to your opponents (especially in the beginning
stages of the game) is destroy the private label market. With your high plant ca
pacities, upgrades and economies of scale, you will be able to sell shoes for a
good profit at the price it costs your opponents to even make the shoes. You may
want to bid odd amounts like $0.45 or $0.95 to make sure you don t lose by just a
few cents. Keep an eye on exchange rates
Plant capacity - No matter which strategy you are going for, it is really import
ant to purchase extreme amounts of plant capacity. The first year, max out your
Asia Pacific Plant and start building a new plant in Latin America. Because of t
he lower wages and economies of scale, the more plant capacity you have in Asia
Pacific and Latin America, the cheaper your costs of shoes will be. You want to
use 120% of your capacity EVERY SINGLE YEAR by unloading all extra shoes into pr
ivate label. It is extremely important you purchase the upgrades for your strate
gy as early in the game. Buy the most expensive upgrades first. You can t purchase
an upgrade the same year you build a plant. You will need to take out significa
nt loans in the beginning years to keep pace with your stock
buyback, plant upgrades and plant expansion (take 10 year loand and maybe 5 year
s also).
You should buy back the maximum amount of stock you can every year until you hav
e bought back the maximum 2.5 million shares. Buying back stock will:
1. Increase your earnings per share
2. Increase your Return on Equity
3. Increase your company stock price
4. Allow you to pay higher dividends per share
Get the dividend down to 0.05 and keep increasing it slowly (say 5 cents every y
ear) until you can crank it up in the final years
Spending on CSR initially may not be a good idea. Does not provide a good return
on investment. Ethics training and diversity maybe in year 16