How To Reduce Cost in BSG Game and Improve Your Score

How To Reduce Cost in BSG Game and Improve Your Score

Cost management is the top lever of success!

High costs can lead to a shortage of operational capital, resulting in emergency loans. This may decrease your credit rating, lowering your points for the target performance.

And that is just one way that unmoderated costs can impact your simulation outcomes as other target performances are hurt too. In this guide, BSG experts share tips on how to reduce cost in BSG game and improve your score.

If you get stuck implementing any cost reduction plan, you can consult BSG game help to walk you through it step-by-step.

Benefits of Reduced Cost

Why should you go through the hassle of learning how to reduce cost in BSG game?

1. Efficient Finance Allocation

You have numerous financial responsibilities as an athlete footwear company operating in a global market arena. This means your costs can exceed the available cash flow if not monitored, leaving you with inadequate funds to run other primary activities.

For instance, if you spend too much cash on Internet marketing or corporate citizenship, you may have a deficit for plant capacity expansion or upgrades. This will, in turn, affect your production process, making you incapable of meeting the client’s demands.

However, reduced costs help you allocate your money efficiently. Consequently, all your departments produce excellent results, improving your company’s financial performance.

2. Products with the Lowest Price

Reduced costs help you cut down on production costs and distribution expenditures, allowing you to provide the market with low-priced products. This attracts more demand for your footwear, although it varies from one region to another.

Hence, you enjoy a bigger market share ranking in higher sales. Whether selling branded or private-label footwear, you will receive more orders if your product is stylish and top quality. Why not use such a strategy to improve your company’s performance?

3. Optimizes Your Company’s Profitability

Your costs are deducted from the gross profits. This means that the higher the expenditures, the lower the net profit or net income. For instance, if your company’s managers are not careful to trace the online orders to the specific geographic region, they might end up shipping a North America order from the Asia Pacific distribution center, increasing your distribution cost.

However, if you dispatch the footwear from the North American center, your transport cost will be lower. This will maximize your net profits compared to the latter. So, you must always seek a best-cost strategy to achieve the highest profits.

What Drives Business Strategy Game Costs?

Before developing a plan to achieve the lowest cost for the BSG game, you must first understand what factors contribute to it. This way, you can identify what to alter or replace for your expenditure to decrease. So, what contributes to your Business strategy game costs?

  • Material
  • Financing
  • Training
  • Plant setup
  • Labour
  • Marketing like celebrity endorsement
  • Corporate citizenship
  • Distribution/shipping, among other company expenditures.

Since cost management determines your Business strategy game performance, you must carefully allocate funds to the different departments. Whether you’re running your company with cash at hand or loans, you should handle money properly.

Note that the winner usually maintains the lowest cost to make shoes that sell competitively. Hence, you must develop the best cost strategy that serves your company with the lowest costs and superior footwear that sells.

How To Reduce Business Strategy Game Costs

BSG game is a simulation that demands a high commitment to production capacity building, market share expansion, and branded distribution, among other heavy investments. As a result, your team may spend a lot of funds on one aspect, leaving out another, only to realize later they messed up.

Here is how to reduce cost in BSG game and increase your chances of winning

1. Company Operation and Cost Reduction

This BSG component concentrates on plant operations and budgeting for different activities. In the early rounds, all companies start the simulation with two plants in Asia Pacific and North America. You can run your plants over time to add capacity by 20% during this period.

In later rounds, you acquire existing plants or new ones in Latin America and Europe-Africa geographic regions. While making the production plan for the first few rounds, your team should consider the overtime labour cost and how much earnings it is garnering for your company. Is it worth the wage expenditure or not?

You should settle for a labour cost that allows you to spend minimal money while producing maximum outcomes. In addition, you need to weigh the cost options of acquiring new or existing plants. Find the best solution by considering the region’s demand and which plant option best meets your needs.

The managers decide how much to spend on more footwear models, new features, and fresh stylish designs. The co-managers control production costs in the following ways.

  • Rising or lowering the footwear quality
  • Deciding the location of the plants
  • Budgeting for best practices training
  • Budgeting for the Six Sigma program
  • Adjusting workforce compensation

You can use these factors to identify the best-cost strategy for each production element while ensuring you produce optimum results.

For instance, can you apply labour negotiations to reduce employee wages? If yes, how much can you save up and not affect your productivity?

As much as we want to reduce the company’s expenditure, we must consider the outcome every cost reduction produces.

Company operations also entail shipping newly produced footwear to the four geographic regions. And all the incoming orders from the retailers and online customers are filled in the same region. This is a critical step for your team to reduce costs since a mismatch in the order and distribution region can spike your distribution cost.

2. Decision Making

In every decision round, the team faces 53 decisions, and you must engage them with the right approach to avoid unnecessary costs that your company cannot cover. These decisions include

  • 6 CSR and corporate citizenship decision entries

It’s easy for your team to go all in when investing in corporate social responsibility as it impacts the image rating, a vital metric in your BSG scoring. Unfortunately, investing high amounts in CSR may drain your operational capital.

Since your company’s image rating contributes 20% of the score, you can implement a low-cost strategy. This will improve your SQ rating at the lowest price while boosting your image rating.

  • 10 production decision entries for each plant

What’s your branded footwear demand?

What’s your private label market demand?

Once you identify how much demand your company has, you can decide on the production units to meet your customer needs. When doing this, try to cut costs on superior materials and operational expenditures.

  • 6 Plant capacity decision entries

What plant capacity can meet your market share demand?

Does your company require plant upgrades for branded production?

Can you consider an alternative of purchasing existing plants instead of new ones to increase your plant capacity?

You should settle for the best decision that serves your financial performance and production targets. Another primary decision you can make in this decision entry is selling your plants.

  • 10 pricing and marketing decision entries

You have different marketing options, including celebrity endorsements and pricing factors. Since celebrity endorsement does not have a measurement for the benefits it accrues your company, you should spend moderately on it.

Remember, a lower price will attract clients to your company rather than your rivals. So, adjust the necessary inputs to produce top-quality footwear at below-average wholesale price.

3. Finance and Cost Reduction

Often the early rounds are used as loss leaders since the image and credit rating are not urgent factors. Hence, your athlete footwear company concentrates on building machines out. This may require you to borrow money heavily as plant upgrades and expansion need a lot of funds.

Moreover, you will need to refinance each round, hence running out of cash should be your biggest concern. Reason? When you experience deficits in operational capital, you will risk borrowing heavily on emergency loans. To avoid this, get a long-term loan; for instance, a 10 year credit which has a lower principal payment, allowing you a better coverage ratio, and ultimately improving your credit rating.

4. The Winning Strategy

BSG game gives you various strategy options; while each has benefits, you want to try the low-cost approach. This strategy demands that you focus on the lowest production cost with a high volume. As your rivals wane, you will acquire their market share.

Nevertheless, it’s vital to note that if you have two teams applying the same approach and yours is not effective, you risk getting huge losses or profits. Hence, you must ensure your athlete footwear company employs the strategy appropriately.

5. Production

Improving your S/Q rating at the lowest charges is the way to go. What do your company’s performance reports tell you about the cost and output? If you spend more on a strategy like total quality management than footwear cost, you should consider another option. Alternatively, you can invest a lower amount in TQM or Six Sigma.

The higher your SQ, the pricier the defect since you use superior materials. As a result, your team should try to minimize the rejected pairs loss by minimizing the number of models offered.

It’s easy to start offering numerous models when you note your competitors are thriving in this area. And although it has a competitive advantage, having a lower price for similar footwear quality is surpassing. Moreover, you don’t have to deal with high defect rates and setup costs.

Cost variation is a critical trend that you want to monitor closely. Reason? As the other teams pursue low-quality footwear production capacity to meet the high demand, you might notice a decrease in the cost of superior materials. You can use this opportunity to divert the market by producing high-quality footwear at a lower or similar price as your competitors and boost your SQ rating.

6. Marketing

When starting the simulation, avoid the private label market and internet sales.

You’re mainly selling to distributors, so internet marketing creates competition between them and your firm. You need to focus on the distributors of direct consumers. A better way to solve this is to increase the number of dealers to exceed your rivals.

Why not pursue the private label?

Private label is too risky to run as it requires your company to price without a margin or risk huge losses when your rival undercuts you, leaving you with no sales. Moving all in the private label market is tempting when you notice another firm has gained massive profits in the current round.

However, you should understand it’s like a gamble because only the first profit does well. So, following suit may mean massive loss of records, dropping your scores.

Tips To Improve Your BSG Score

Your BSG game performance determines your final score. Hence, you must apply the right strategies to boost your target performances, including EPS, stock price, credit rating, ROE, and image rating.

Here are some tips to help you win the Business strategy game simulation

  • Collaboration

Your team gathers different individuals with unique abilities. Similar to the real business world, when solving marketing or production issues, the staff conducts meetings to provide beneficial contributions to drive the company’s goals.

This applies to your team, too, if you want to win the Business strategy game. Your team has to work together and help each other fill the gaps within a particular spectrum. In addition, just like the official meetings require managers to back up their ideas or findings with data, the BSG game relies on proper research to help drive success across its functional units.

So, ensure you cultivate teamwork in your company.

  • Improve Your Image Rating

The BSG game has an industry average image rating requirement of 70. Hence, each team should maintain a rating of 70 or above to increase its chances of winning. But how can you achieve a high image rating?

You can apply different approaches to improve your image rating, including

  1. Implementing an effective styling quality strategy
  2. The best-cost strategy boosts your SQ rating, directly affecting the company’s image rating
  3. The corporate social responsibility initiatives show good corporate citizenship

Practising these will result in a better image rating score contributing to higher Investors’ Expectations and Best-in-industry points.

  • Increase Your Stock Price

Unfortunately, the business strategy game does not provide a clear metric for stock prices. Nevertheless, students can use the stock price – EPS and ROE relationship to improve their company’s stock prices.

  • Improve EPS and ROE

Your Earnings per share, return on equity, and credit rating are critical financial performance measures. These three are among the five targets contributing to 20% of your perfect score in the BSG game. As a result, anytime you neglect them, they contribute fewer points, affecting your final score.

How do you increase your ROE?

Return on equity is a function of net profit and shareholders’ equity. To get the ROE ratio, you divide the net profit by the shareholders’ equity, so adjusting any of these elements shifts the ratio to a higher or lower figure. You can start by increasing the net profits. Alternatively, repurchase stock to reduce the shareholders’ equity for a higher outcome.

Increasing your EPS is one of the simplest ways to boost your BSG score. The earnings per share ratio is determined by dividing net income by outstanding shares. As a result, anytime you increase your net profit, you raise your EPS value automatically.

  • Credit Rating

The business strategy simulation expects you to meet a credit rating score of B+ or higher for a chance to win the simulation. The credit rating is usually a function of debt to asset ratio, risk of-default ratio, and interest coverage ratio.

You can improve your credit rating by using your cash flow to lower the debt-to-asset ratio. Alternatively, reduce your interest rate by refinancing the debt to a lower rate or pay it off.

But how can you reduce the risk of default ratio? To lower the risk of default ratio, minimize the total interest expenses.

  • Improve Your Net Profit

Directing your efforts to increase net profit margin solves a lot of financial performances in the Business strategy game. For instance, with a high net profit, your return on equity ratio upsurges, leading to higher Investors Expectations and Best-in-industry scores.

A higher net profit also affects your earnings per share which is a vital consideration for shareholders. You can increase your net profit in different ways:

  1. Expanding your market share to serve a larger clientele
  2. Reducing your direct costs will raise your net income as there will be fewer deductions
  3. Employing a below-average wholesale price to increase the number of sales
  4. Lowering your employees’ wages expenditure while maintaining the same productivity
  • Get BSG Online Help

The constant hardship of strategizing and implementing different aspects to solve problems in all departments can be overwhelming. Sometimes students get confused during certain simulation rounds, especially when they can’t unravel one aspect.

You don’t have to bear all the simulation’s complexities alone. You can find help from BSG online experts. Whether you’re stuck making workforce diversity program decision entries or increasing your Q rating, BSG online help can assist you in winning the game.

So, how can you choose the right BSG help?

Finding the Right BSG Online Help

How can you find the right BSG online help for your simulation needs?

Here are the elements to evaluate when searching for BSG game services

1. Customized Help

Every student encounters a unique challenge in the simulation; when your company is solving an image rating score issue, other teams are struggling with Q rating or stock price. As a result, the suitable BSG game tutor will offer individualized assistance that meets your needs and not a generalized plan for every problem.

Moreover, an excellent BSG professional will go the extra mile to study your company’s situation. Then work towards improving the components of your focus area. For instance, if you’re struggling to achieve a high image rating, your tutor will examine the SQ rating and the CSR to help you develop a suitable solution.

2. Price

How are the provider’s services priced?

Can you afford to pay for the help or not?

Price is a crucial factor when considering hiring a BSG professional. You should examine the price with your budget in mind. If the BSG help lies within your budget and is reliable, start discussing the type of service you need.

Nevertheless, do not go for extremely low-priced BSG services. Reason? Some cheap services are a setup to steal your money or deliver substandard assistance. So, ensure you find an affordable price matching the expertise you seek.

3. Transparency

Transparency is crucial in every online business since it creates trust between providers and clients, helping them cooperate efficiently. Hence, when searching for BSG help, you should find out whether the providers in your list uphold this value.

Start by evaluating whether they state the prices clearly. Then check the services they are offering have a clear listing. This will allow you to plan in terms of finances and service options.

4. Reputation

What do the online reviews tell you about the service provider?

Is there proof that the BSG help company has experience helping learners succeed?

Learning providers’ history is informative as it helps you know who they are and what they can do towards your success. You can learn from previous clients whether you’re worried about their privacy or security systems.

Don’t be in a hurry to collaborate with a service provider just because they’re providing cheap services. Ensure you are confident in their services and the company as a whole.

5. Convenience

From time differences to payment alternatives, BSG attracts a population across the globe. This means you will be finding service providers from far countries. Consider this; when the time in your country is noon, and the service provider’s time is 11 am. This can be a great challenge to unravel, so try to find a flexible service provider to work according to your schedule.

You should also consider the payment options your provider avails for clients. You don’t want to start long registration processes for a one-time service. You can get universal options such as PayPal, Visa, and UnionPay from other reliable providers.

BSG Help Services

BSG game has different components that require unique assistance. Depending on your simulation needs, you can choose from the following options

  • Best-Cost Strategy Help

Developing the best-cost strategy for your BSG game can be daunting due to the numerous elements you must incorporate. Sometimes, you might be sure you’ve solved all the challenges in the previous round, only to realize you’re stuck in the same image rating or stock price.

You don’t have to spend sleepless nights restrategizing for your game; you can ask for professional support to create an ideal plan for your game. And we will help you improve your score!

  • BSG Score Help

Whether you’re struggling to increase your Game-To-Date score or Best-in-industry points, our BSG game experts are here to help you. As top business simulation graduates, they understand the different aspects of BSG scoring and therefore know what needs to be done to boost your scores.

So, don’t give up on your Investors Expectation score. Connect with one of our professionals for proper guidance!

  • BSG Assignment Help

So, your professor sent a BSG assignment, but you can’t figure out the right solutions for the quizzes?

The BSG Assignment help got you covered. This service is designed to provide students with homework support that meets their needs. Whether your instructor requires you to write a report or answer complex business simulation queries, our team of professionals offer you unrivalled assistance.

Don’t get stuck with your homework; we can help you solve it!

  • BSG Tutoring

Is it your first time playing the business strategy game? If yes, you may encounter complex components which can be challenging to comprehend. Fortunately, you don’t have to work on a limited BSG knowledge base; you can get tutoring help to master the different elements of the whole game.

Our tutors provide precise explanations on different topics like how to reduce cost in bsg game. You can ask for help in all areas.

  • BSG Game Guide

From how to run your first to mid and last simulation rounds, our game guide provides step-by-step explanations on how to engage in the BSG online exercise. It expounds on the elements you encounter in the simulation rounds, helping you prepare the best plan from the initial stages.

So, whether you’re struggling to understand how Q rating or bonus points scoring works, you can explore the BSG game guide to learn the rules of the game.

Let’s Boost Your BSG Score!

Reducing your cost while increasing the net profits is among the top ways to improve your score in the BSG game. However, you can’t just guess numbers in the different departments to work with. For instance, you have to make informed production costs decisions to produce the correct number of branded pairs for your market share.

Don’t get confused settling for a BSG strategy; our experts are here to help you develop the best-cost strategy and improve your score. Connect with a BSG expert to achieve your academic goal!

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