Mosaic Enterprise Challenge

Transcription

1 Mosaic Enterprise Challenge User Guide to the online game This guide is designed to help you understand how to play the online game. Please read it carefully, as it will help you to achieve the highest score. What s it all about? The aim of the game is to achieve the highest net profit. You will talk about what this means with your mentor. The game is divided into six stages. Our advice is to work carefully through each stage, thinking as a team about the choices you need to make. Stage 1: introduction to the game The introduction pages show you how to use the interfaces of the game, including the PDA, PC, ring binders and plasma screen. The game s built-in mentor will talk you through this stage, so watch out for their instructions. To start stage 1, click on the plasma screen in the office and you will come to this page Stage 1: Introduction the scenario & game interface. The six tools of the game are shown and as you click on each tool, their use will be explained. When you have clicked on each tool, the icon underneath will change from a cross to a tick, to show that you ve read the information you need to. Once you have six ticks, you can move to the bottom right of the screen and click start Stage 2. Stage 2: Market Research and Product Choice In Stage 2, you need to decide which product your business will trade. There are five products to choose from, a laptop, an ipad, an alloy wheel, a diamond ring, or an ipod mini. You can only choose one, and you can t change this choice once you click on confirm product & go to Stage 3. You can of course make a different choice the next time you play the game. To help you choose, you need to read the market research information. Market research is information collected from customers about what they want from a product. There is no right or wrong choice of product. You ll notice that the market research tells you that customers want different things from different products. Our advice would be that you discuss what you think as a team, taking care to note what the market research says about quality ethical considerations and price, as this will guide you in decisions you need to make, further on in the game. You will score highly in the game if you concentrate carefully on all the advice in this stage don t rush! In this screen, click on GO TO MARKET RESEARCH and a tab with market research about each product will appear. Click on each product tab in turn to read the relevant information. When you have decided, on this screen you need to click on your choice of product. Then write in the box why you have chosen the product. Then click on confirm product & go to Stage 3 Page 1 of 5

2 You may find it useful to make notes as you go through this stage, to record how and why you chose the product (for example, what was it in the market research that persuaded you). At the end of the game, when it generates your results including net profit, you can weigh up whether you d make the same choice again, or whether you d choose a different product. Stage 3: Select a Sales Channel Now that you ve chosen your product, you need to decide how you will sell it. There are three choices of sales channel; using a sales agent, using a distributor or using direct sales. There is no right or wrong answer. Each sales channel has different advantages and disadvantages. You can only choose one channel, and you can t change this choice once you click on confirm sales channel & go to Stage 4. You can of course make a different choice the next time you play the game. In this screen, click on GO TO SALES CHANNELS and a tab with information about each channel will appear. Click on each tab in turn to read the relevant information. Q: How do I know what price to select? A: Setting your price high will maximise the profit that you make from each product sold; however if it is too expensive, customers may buy from your cheaper competitors instead. On the other hand, if your price is too low, you may find it difficult to cover the costs of production and although you have plenty of demand, you will not have enough sales revenue to pay the bills. Consider what the market research said about price, and balance your decision on price with how much you will spend on sales & marketing and the level of quality you are aiming for. You will also be able to see the prices your competitors in the game have chosen. 2) YOUR SECOND TASK IS TO SET YOUR SALES & MARKETING (S&M) BUDGET Sales and marketing includes all the ways that businesses persuade customers to buy their product. You ll discuss this with your mentor, including how you are persuaded to buy products in your own life, for example, through adverts. Q: How do I know what S&M budget to set? A: The more you spend on sales and marketing, the more customers will know about and desire your product. However, your budget for this is taken from the gross profit, meaning that it reduces your net profit, so you may not automatically decide to spend the maximum possible in this area. As with pricing, you may find it helpful to consider what choices your competitors in the game are making. 3) YOUR THIRD TASK IS TO SET YOUR PRODUCT QUALITY The final choice to make in this area is to choose the quality of your product. Quality means how good the product features are. How well made is it? How well designed is it? How durable is it? When you have decided, on this screen you need to click on your choice of channel. Then write in the box why you have chosen the channel. Then click on confirm sales channel & go to Stage 4. Stage 4: Prepare to Trade You have now chosen a product and decided how you will sell it. Your next tasks are to decide the price, the level of quality, and your budget for sales & marketing. 1) YOUR FIRST TASK IS TO SET THE PRICE The price is what the customer will pay for the product. Q: How do I know what quality to set? A: You need to bear in mind that higher quality products are more expensive to produce, so if you choose high quality, your costs will be higher (which will affect your profit). However, the advantage of a high quality product is that it may be very attractive to customers, so you may achieve higher demand, and therefore, more sales revenue. Re-read the market research to remind yourself what customers said about quality and ethical concerns for your chosen product. For this stage of the game, refer to the PC in the online office. Click on the Management Information System (MIS) icon and then choose Marketing (from the navigation bar).

3 Here you will see the prompts to set your price, the level of quality, and your budget for sales & marketing. You will be able to make changes to these decisions throughout the game. Stage 5: Begin Trading! You are now ready to launch your business! In the game office, go the plasma screen to start trading - a period of 3 years virtual trading now begins. At regular intervals, you will be provided with reports and other information on the game office PC. You will also receive s on the PDA from stakeholders in the game, such as your bank manager and your boss. It s important to read all of this information as it will show where you need to make changes to improve performance. You can control the speed, so you can make the months go faster or slower, depending on how much time you want to consider decisions. You ll probably want to go slower as you start out. On the PC in the financials tab, you will be able to see your financial performance, showing you the gross and net profit your business is achieving each month. As each month s reports come in, you can analyse what is going well and what you need to change to see your net profit grow. Stage 6: Complete Trading You will come to the end of the game in one of two ways: 1) You will go bankrupt. The game stops automatically if you run out of money and cannot pay the bills. Don t worry this happens to everyone as they start playing the game! You ll do better next time. It is useful for your team to reflect on what led you to become bankrupt. And of course, what would you do differently next time? OR 2) You will complete three years trading and be presented with a final performance report which shows your net profit. Well done! Again, it s useful for your team to discuss what went well in the game, and what you might do differently next time. In either outcome, the game will generate a report which you should print out, as it s a useful record of your performance and a good way to reflect upon your progress as you continue to play. Also in the financials tab, you can look at your sales charts, showing the sales revenue you are achieving per month. You ll also be able to see your cash flow, which is the money you have available to spend. You will also have access to important information via the production tab. This includes details about the overall level of demand for your product per month, the current production capacity, stock levels and the current surplus or shortfall. You will be able to make adjustments during trading which affect production, for example you can add or remove production lines and adjust staff overtime. See the glossary for an explanation of these terms, and discuss them with your mentor.

4 Glossary of terms You will come across the following terms during the competition. If you are unsure of what a word means, be sure to ask your mentor or teacher. Accountant A person who is skilled in the practice of accounting or who is in charge of public or private accounts. An accountant is responsible for reporting financial results for a company in accordance with government and regulatory authority rules. Agent An individual who is authorized to act on behalf of another to conduct, for example, selling. The agent does not assume any financial risk in transaction as a dealer would. Budget An itemized forecast of a company s income and expenses expected for some period in the future. Bankrupt A company that has been declared insolvent by a court and is relieved from the payment of all debts after the surrender of all assets to a courtappointed trustee. Capacity A company or economy s ability to produce goods and services. Cash Currency and coins on hand, bank balances, and negotiable money orders and cheques. Cash Flow A measure of a company s financial health. Equals cash receipts minus payments over a given period of time. Certificate of Incorporation A certificate issued by the state in which the company will be registered, which certifies that a company is registered and has a unique company number. Company Any entity engaging in business, such as a proprietorship, partnership, or corporation. Competitive Being competitive, in the context of the Business Game is about matching or, if you can, beating your competitors on price and/or product quality in order to secure the desired level of demand. Competitor Competitors are other companies that sell products that are similar to yours and, because of this similarity, customers may choose to buy from them instead of your company. Customer Care The process of ensuring that your potential and actual customers are satisfied with the way in which you provide them with information, sell them your product, support them and deal with any problems that may arise. Demand The quantifiable amount of potential customers for your product. Direct Costs The costs that your company incurs in producing the products and getting them to customers, distributors or retail outlets. This may include some sales costs if that sales activity is directly attributable to individual orders. Distribution The mechanism by which a company gets its products to customers. Distributor A company which sells and delivers merchandise to retail stores or acts as an intermediary in business. Demographic Socioeconomic groups, characterized by age, income, sex, education, occupation, etc., that comprise a market niche. Enterprise A business or commercial venture. Can also apply to a social enterprise where the profits from the activities of the organization are used for social good rather than personal gain. Entrepreneur People who undertake the risks of production in order to make a profit. Forecast An attempt to predict the future performance of a business, usually by looking at figures or by undertaking market research. Gross Profit This is sales revenues minus the cost of sales (see Direct Costs). Investors Investors buy shares (equity) in a company on the basis that they believe the company will grow and increase in value so that their equity is worth more and so that they can earn regular income from dividends. Market Knowledge The degree to which an individual or a company knows and understands the marketplace into which they are seeking to sell. This might be a sectorbased marketplace (e.g. the market for DVD players) or a geographic market such as, for example, France. Market Research Research that is conducted in order to understand the dynamics of a particular market and includes information such as customer demographics, economic and political factors.

5 Market Share The percentage of an overall market that one company has (based on revenues or unit sales volumes). Market Size The overall size of a market measured in financial terms or in numbers of unit sales. Mentor A person whose experience, skills and qualifications mean that they are able to advise a company, owner or manager on a range of issues such as sales and finance. Net Profit Calculated as gross profit minus overheads. May be quoted inclusive or exclusive or corporation tax. Overheads The company s costs that are not directly related to the cost of production. Overtime Hours of work undertaken above the standard working hours. Price The amount of money for which goods and services are bought and sold. Production Costs A cost directly attributable to the manufacturing of a product. This is the opposite of indirect cost. Revenues The money received from the sale of output. Sales Channel The route or method by which a company sells its products or services into a particular marketplace. An example is the use of distributors. Shortfall The difference between the required level of production to fulfil customer orders and what is actually produced, if the latter is lower than the former. Start Up A new enterprise that (typically) has yet to achieve significant customer orders and which may not yet have a finished product or service that it is able to sell. Storage Costs The costs associated with physically storing products that have not yet been sold or which are scheduled to be shipped to customers. Surplus The difference between the required level of production to fulfil customer orders and what is actually produced, if the former is lower than the latter. Trading The process of providing a product or service which is intended for sale to customers in order to derive sales revenues and to generate profits. Training The process of developing staff in order that they are better able to carry out their current or future duties. Turnover Generally refers to the amount of sales revenue in a given period, such as 1 million in the last year. A free Android Glossary App is available to download from Google Play at this address tbgglossary.totem&hl=en_gb Your notes Sales Strategy The long-term action plan for achieving the company s sales objectives (as expressed in the sales forecasts). Sales Commission A fee that is paid to an external company, sales person or internal sales person. Commissions are usually paid for generating sales leads and/or for securing sales orders and are usually based on a percentage of the order value. Sales & Marketing The processes relating to identifying and communicating with potential customers (marketing) and with securing orders from these customers (sales). Sales Revenues The money that is received from the sale of products or services to customers.

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