BSG Online How-To's: How to Win BSG Game & More
Written by Dave Mar
Updated: 6/19/2024
As you probably have already found out, the Business Strategy Game can be overwhelming. As you are going through the BSG game, it will become clear that there are many moments that you will ask yourself, "How do I do that? How is this calculated?"
Well, this is your ULTIMATE HOW-TO GUIDE for BSG Online.
Other BSG Game Insights that I recommend:
How to win BSG Game
Obviously, this is everyone's greatest question. Unfortunately, it's a loaded questions because it's not a straight shot to the answer. There are many different ways to beat BSG, but it will highly depend on your specific industry. Each BSG game can be very different, although the core fundamentals are the same and those are what I teach in my Zoom tutoring sessions.
You can win BSG by making solid long-term decisions early to build a strong production strategy that will allow you to produce some of the cheapest shoes against your competition. Now, instead of lowering your prices to try and obtain that extra market share, I suggest maintaining an above average wholesale price to improve your net profit margin.
Profit is king in BSG and if done properly, you can create a firm that will have some of the lowest productions costs while having the highest quality shoes on the market. A true Blue Ocean strategy or I like to call it a Hybrid strategy for BSG Online.
How to increase EPS on BSG
Increasing your Earnings Per Share (EPS) on the simulation is probably one of the easier scores to do as long as you are focused on net profit and buying back stocks. Below you can see the equation used in the Business Strategy Game to calculate EPS. So, as long as you are increasing your net profits while reducing outstanding shares, EPS will rise!
How to calc EPS in BSG
Earnings Per Share = Net Income / Outstanding Shares
How to increase ROE in BSG
Understanding how to raise ROE in BSG is crucial to getting a good overall score. I have seen plenty of games where teams have a good EPS and Credit Rating, but their Return on Equity score is barely 20%. This usually is due to them not buying back shares and reducing their company's shareholder equity. So, to improve your ROE, buyback shares and increase net income.
How is ROE calculated in BSG
Return on Equity = Net Income / Average of Total Shareholder's Equity at the beginning of the year and the end of the year on the company's balance sheet
How to increase Stock Price in BSG Game
Unfortunately, BSG Online provides absolutely zero knowledge on how they calculate stock price in their simulation. Based on experience of helping hundreds of students and understanding basic finances, stock price is correlated to both EPS and ROE. The higher these metrics are, the more likely you stock price will go up.
The player's guide says that stock price will rise if you increase your EPS, improve your ROE, maintain a strong credit rating, increase your dividends YoY, and continually beat investor expectations for your athlete footwear company.
How to increase Credit Rating in BSG
Improving your credit score is one of the quickest ways to improve your overall Game to Date score (GTD). This can usually be done by focusing your cash flow on reducing your debt to asset ratio on your company's balance sheet.
Credit rating is calculated by three different metrics: Interest Coverage Ratio, Debt to Asset Ratio, and Risk of Default Ratio
Reducing your interest rate can be done by simply paying off debt or at the very least refinancing that debt to a lower rate. D/A ratio can be reduced by increasing assets and lowering debts. The risk of default ratio can be improved by reducing your total interest expenses.
How to increase Image Rating in BSG
Your company can increase image rating by improving your quality S/Q rating and using a strong branded styling quality strategy. Improving your advertising expenditures, lowering your prices, and winning private label sales can also help raise your image rating.
Although getting a high image rating is important to get a perfect score of 110 (plus bonus points), I don't believe this should be the main focus. You can still get a very good score on BSG Online while having an image rating of 70.
Now, this is not ideal, but I have seen time and time again when students get overly contentious about their image rating score. If your firm is able to maintain strong EPS, ROE, stock price, and credit rating, you should probably have a fairly good image rating. Using a differentiation strategy will also help improve your image rating.
How to increase Net Profit in BSG Game
I see so many students get this wrong. They overly focus on trying to have too high of sq rating, too low of prices in wholesale and internet marketing, poor distribution and/or branded production strategy, and the wrong mindset for market share.
Having a strong cost strategy by gaining economies of scale in Latin America and Asia Pacific are vital for improving your net profit. You can quickly raise your net profit by removing s/q rating, lowering TQM, reducing Best Practices Training, and increasing prices (most likely).
These are short term fixes though and not recommended unless you are in severe need of help. If that is the case, I highly recommend meeting with me for a Zoom tutoring session before your score gets even more difficult to fix.
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