http://www.gztopboss.com/forums/feed Sat, 30 Aug 2025 21:25:43 +0000 https://bbpress.org/?v=2.6.9 zh-Hans http://www.gztopboss.com/forums/topic/how-should-we-make-decision-on-purchasing-raw-materials-quantity-in-the-first-period/#post-10409 http://www.gztopboss.com/forums/topic/how-should-we-make-decision-on-purchasing-raw-materials-quantity-in-the-first-period/#post-10409 Tue, 24 May 2022 09:00:50 +0000 Top-BOSS How should we make decision on purchasing raw materials quantity in the first period?

• What you do in the first period impact your potential demand immediately. The effect may be extended into the future periods too.
• Any procurement of raw materials at the first period will have to align with the potential demand that you anticipate for the second because it will be used to produce finished products to capture the potential demand in the second period.
• Note also that the price of raw materials can fluctuate from period to period and the inflation factor comes into play.
• If the market condition is such that price of raw materials is going to rise rapidly in the future periods, should you buy more now so you can save some money? But on the other hand, if you spend more money on raw materials now, do you still have money to pay for other expenses that are essential in creating potential demand?
• Buying a little more that the anticipated demand in the next period will impact your bottom line less than buying a little less, because not capitalizing the fullest of the potential demand does more harm to the bottom line than committing some more capital on raw materials which are still needed and will be used into the future. You need to find the equilibrium.

]]> http://www.gztopboss.com/forums/topic/why-competitors-sales-higher-than-our-potential-demand-even-though-they-have-higher-price-and-lower-product-image-and-quality/#post-10407 http://www.gztopboss.com/forums/topic/why-competitors-sales-higher-than-our-potential-demand-even-though-they-have-higher-price-and-lower-product-image-and-quality/#post-10407 Tue, 24 May 2022 08:51:45 +0000 Top-BOSS Why are some company’s sales higher than our potential demand even though they have higher price and lower product image and quality?

• Why some company’s sales is higher than your potential demand?
  Could it be because they have a higher potential demand?
• Why some company’s price is higher and product image lower and still sells more than your potential demand?
  Note that investment in the previous periods still have effect on potential demand into the later periods in the simulation game, and price elasticity could neutralize the differential between the competitor’s higher price and your lower price.

]]> http://www.gztopboss.com/forums/topic/how-to-increase-potential-demand/#post-10405 http://www.gztopboss.com/forums/topic/how-to-increase-potential-demand/#post-10405 Tue, 24 May 2022 08:50:17 +0000 Top-BOSS How to increase potential demand?

• Potential demand is RELATIVE. In the simulation game, total demand is divided between the competitors based on some factors. Price, product image, product quality are three most important factors.
• Higher product image, and higher product quality result in higher potential demand while higher price results in lower potential demand.
• The effects of these factors on potential demand are also RELATIVE. You may think you have done a lot, but your competitor have done even more, so your potential demand does not increase, or worse, decreases.

]]> http://www.gztopboss.com/forums/topic/what-strategies-may-we-use-to-increase-net-profit-when-we-have-net-losses/#post-10403 http://www.gztopboss.com/forums/topic/what-strategies-may-we-use-to-increase-net-profit-when-we-have-net-losses/#post-10403 Tue, 24 May 2022 08:45:28 +0000 Top-BOSS What strategies may we use to increase net profit when we have net losses?

• There is no one “sure win” strategy. There is also no such strategy that is bound to bring “sure losses”.
• Net losses can be the result of two situations. One, you set out with a strategy but what you do is in opposite direction of that strategy. Two, you don’t really have a strategy and you are changing directions all the time.
• For example, you decrease the price in one period and then increase the price in the next period, and then decrease the price again and increase the price again. What are you trying to do?
• For example, you keep on producing and cannot sell enough of the output because you are not marketing enough, or you don’t produce enough even though you have created the market potential with huge investment.
• For example, you spend a lot of your capital in the wrong place at the wrong time.
• A “strategy to increase net profit” is about how much you should invest in creating a certain quality, a certain production image, a certain production efficiency, and then how much you should produce to sell at what price to capitalize the market potential
  thus created.

]]> http://www.gztopboss.com/forums/topic/if-marketing-campaign-effect-is-low-blue-does-it-mean-that-product-image-is-growing-slower/#post-10401 http://www.gztopboss.com/forums/topic/if-marketing-campaign-effect-is-low-blue-does-it-mean-that-product-image-is-growing-slower/#post-10401 Tue, 24 May 2022 08:42:45 +0000 Top-BOSS If marketing campaign effect is low (blue) does it mean that product image is growing slower or that the customer is not interested in the product image?

•  Low refers the effect being small.
• Be it marketing campaign effect, market growth rate, price elasticity, etc., low means the differential is small and high means the differential is big. So yes, “low” means the customer is not that much impacted by the product image to buy, therefore, don’t
  expect the high rating of product image to bring you big change in sales. It follows therefore that a big investment to try improving product image may not reward you all that much.
• Also, investment is relative. You may think you have invested a lot, but the competitor who invested even more get higher rating. It follows that you may get little effect even though you may have invested a lot because you competitor is investing against you.
• It makes little sense to compete with the competitor for higher rating in a market that the effect of the rating is “low”.

]]> http://www.gztopboss.com/forums/topic/why-the-revenue-and-market-share-are-good-but-can-not-make-the-profit/#post-10398 http://www.gztopboss.com/forums/topic/why-the-revenue-and-market-share-are-good-but-can-not-make-the-profit/#post-10398 Tue, 24 May 2022 08:39:49 +0000 Top-BOSS Our revenue and market share are good but we are not able to make the profit. What are the factors behind it?

• If you are not making profit despite good revenue and market share, the obvious reason is almost always the costs. You just don’t know your costs.
•  You may be penalized by emergency purchase and you just don’t know it. You may produce a lot, sell a lot, but you also pay a lot. There is no warning bell from the system that you are bleeding. But you will see it in the cash flow.
• You may be over investing in R&D expenses, marketing expenses, maintenance expenses, and equipment investment. Much more investment do not give you much more results. The simulation game follows this law of economics called diminished return.
• Also, you could be missing out on the market potentials created by your investment because you are not producing enough to fully capitalize the potential.
• Again, plan well. Align production request/allocation with inventory, align investment with sales and market share desired.

]]> http://www.gztopboss.com/forums/topic/how-to-avoid-having-emergency-purpose/#post-10396 http://www.gztopboss.com/forums/topic/how-to-avoid-having-emergency-purpose/#post-10396 Tue, 24 May 2022 08:36:38 +0000 Top-BOSS How to avoid having emergency purpose?

• Indeed, you want to avoid having emergency purchase because there is a huge penalty. Almost double the price. Don’t do it if you do not mean it for a good reason.
• You could still end up with emergency purchase if you are not careful. For example, you failed to factor in the conversion coefficient, and become a little short on raw materials.
• Plan well in order to avoid having emergency purchase. Calculate accurately.

]]> http://www.gztopboss.com/forums/topic/how-to-calculate-the-emergency-purchase/#post-10394 http://www.gztopboss.com/forums/topic/how-to-calculate-the-emergency-purchase/#post-10394 Tue, 24 May 2022 08:35:18 +0000 Top-BOSS How to calculate the emergency purchase?

• Any procurement of raw materials at the first period will become inventory at the second period, and therefore not available to support production with one exception.
• When the production request/allocation exceeds what the inventory of raw materials can support, the additional raw materials needed to support the request/allocation will be taken from the procurement of raw materials for the next period.
•  i.e. the material purchasing quantity, and it is paid for on an “emergency purchase” basis, i.e. at a penalty price of $1.50 more per unit than the market price, so that they are delivered immediately for use in the production according to the production request/allocation.

]]> http://www.gztopboss.com/forums/topic/how-should-the-production-allocation-be-made/#post-10392 http://www.gztopboss.com/forums/topic/how-should-the-production-allocation-be-made/#post-10392 Tue, 24 May 2022 08:32:40 +0000 Top-BOSS How should the production allocation be made?

• Allocation of production request/allocation must follow the strategy.
• How much you think you can sell in each of the four markets? How much you want to sell in each market and why? One thing is always true. A company makes decisions to change the market potential for its product in order to sell more.
• You have only so much raw materials in inventory that become the limiting factor to production request/allocation.
• Some markets may have higher potential than others under the market conditions set for markets 1, 2, 3, & 4.
• You should make request/allocation for each market to meet potential demand of that market but within the limit of the inventory of raw materials.

]]> http://www.gztopboss.com/forums/topic/is-the-cost-for-each-company-different-after-the-first-period/#post-10390 http://www.gztopboss.com/forums/topic/is-the-cost-for-each-company-different-after-the-first-period/#post-10390 Tue, 24 May 2022 08:29:53 +0000 Top-BOSS

Indeed, the costs of each company will be different after the first period, but not in terms of raw materials, labor, and logistics per unit of finished goods.

 Each company made investment on R&D expenses, marketing expenses, maintenance expenses, and equipment investment, and changed the market potential for its product as well as the cost (e.g. Conversion coefficient) of making theproduct. These are fixed costs.

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