Capsim Quiz 2 Flashcards
Which segment moves slower
Low Tech Segment
What is the drift rate?
Rate at which the segment moves (monthly)
What is the ideal spot
Point of the segment where all other things being equal demand is at its highest
What does the marketing department do?
-Forecasting sales
-Promoting both product and brand
-Pricing and selling your product
How does the finance and production department use the sales forecast
Production: how much of each product to manufacture
Finance: develop proformas and expected cash position
What do the country tabs show in the marketing department?
-Displays the product and information on that country
-Important because customers from different regions place different levels of importance on product aspects
What do the marketing charts show?
-Info on the company and business environment
How is the price set in a foreign country?
-per unit in local currency
-also shown the conversion to usd
What does promotion budget determine?
-determines a products level of awareness
What does a products awareness reflect?
-The number of customers who know about your product
What % of customers who knew about your product previously forget it?
33%
Formula to find CY starting awareness
Last Year’s Awareness - (33% * Last Year’s Awareness) = Starting
Awareness
How do you view your awareness?
Within the marketing department interface
What % is awareness increased by when you create a new product
-25% for new buzz
What does a segments sales budget determine?
-Segment accessibility
What does segment accessibility represent
-number of customers who can easily interact with your company
Channels customers can interact with your company.
-salespeople, customer service, delivery
What happens if your sales budget drops to 0
-you lose one third of your accessibility every year
other accessibility and awareness calculation
Starting Accessibility + Additional Accessibility from Sales Budget Curve =
New Accessibility/awareness
How do products in the same segment get a boost to accessibility
-as if you were investing in each
-1,500 = 3,000 if you have two products in a segment
Differences between accessibility and awareness
Accessibility (sales budget)
-during and after the sale
-spent on distributions, order entry and customer service
-affects the segments
Awareness (promotion budget)
-Before the sale
-spent on advertising and public relations
-affects the product
Two methods to forecast in the simulation
PY actual sales * 1 + segment current round growth rate
PY potential sales * 1 + segments current round growth rate
What does potential sales represent
Total units you would expect to sell in a perfect market
What does potential sales consider
-product stock out from your company and competitors
-That demand is consistent
What does your customer satisfaction score consider
-evaluating each product against the buying criteria
-criteria’s levels of importance (Positioning)
-Awareness and accessibility
How do customers in each market view price
differently
What happens if your competitor has an equal product that is cheaper
-you will lose market shares
How is price in the buying criteria reflected
-reflects local price (sales price after currency exchange rates to usd)
effects of exchange rate
-1% transaction fee
-appears on cfs as effects of exchange rate changes
what is the responsibility of the production department
-manufacturing enough products to meet customers’ demands
-level of capacity and automation of your production lines
What is the first decision you company has to make
moving your production facility to a foreign nation or staying put in the USA
USA Stats
Cost to ship 0
defect rate 4%
tariff 0%
hourly wage $22
Germany stats
Cost to ship 2.50
defect rate 2%
tariff 5%
hourly wage $22.89
China stats
Cost to ship 2.50
defect rate 6%
tariff 3%
hourly wage $19.11
Affects of the move
-can only be done in round one
-will occur on January 1st of round one
-2m dollar cost
-capacity and automation remain the same
Do you have a cap to plant investments
yes
What does capacity determine
number of units a plant can produce
how much does each new unit of capacity cost
$6 floor space + ($4 * automation rating)
affects of using double shift employees
+ 100% capacity
+ 50% labor cost as compared to first shift
what is automation
-how much you can produce without human labor
levels of automation rating
1.0 - 10.0
each point of automation decreases labor by 10% for a max of 90% reduction in lc
Downside of automation
increases the time it takes for products to be revised by the R&D department
level 10 any change takes at least one year to complete
Actual number of units produced
-always slightly less then production schedule
-bc of defects
Factors to consider when making the move
-plant info
-capacity
-automation
-actual
% hourly wages increase every year
5%
