How to successfully start your Business Strategy Game
Written by Dave Mar
Updated 6/19/2024
Four Essential Tips 🚀
Suggested BSG Online Insights:
It is essential to start your BSG simulation off right to have the best chance at winning against your competition. The Business Strategy Game creators will never say that companies who lead have a better opportunity at winning, but it's true. Many of my students that I tutor that get a head start in the game usually do very well.
Below are four essential tips to do well in your BSG game from the starting line.
Tip #1 - Build in Latin America
Building in LA is probably THE most important long-term cost savings strategy you can employ in your game. The sooner you build space and equipment in Latin America, the faster you start saving $10 per shoe in tariff expenses, PLUS it's one of the cheapest places due to labor costs. Remember to build at least 3,000 space because you will realize economies of scale, which leads me into the next tip...
Tip #2 - More Production = Cheaper Shoes
Here is a simple mistake I see quite often in BSG. Many companies only build 1,000-2,000 space in Europe-Africa and Latin America or let their equipment depreciate in years 15/16, but never build the equipment back. Producing only a few thousand shoes in each area will skyrocket your cost per shoe. It is very important to make sure you are producing at least 3,000 shoes in a production facility or you should seriously consider using another facility that can produce more OR find other efficient ways to decrease your demand while increasing profits.
Tip #3 - Don't Drop Retailer Support (yet...)
A personal mistake I made while in my simulation when I was obtaining my MBA. Although it may seem that dropping retailer support to zero helps your EPS and net profits, it is actually harmful to do until the final year (hint hint). This is because dropping retailer support will reduce your demand year over year. You need to keep it above the industry averages to continue growing your demand.
Tip #4 - My Greatest Tip
As you can see in the picture at the beginning of this article, there are four corners that you can potentially go to for your business game strategy. Each one has its play style and will need to be handled differently. My favorites are 3 and 4 due to being able to sell a lot of shoes and usually making the most profit. I have helped hundreds of students succeed in these corners. The best one would probably be number 4, but you need to be the industry leader to do well up there. Your company will need extensive investments in Best Practices Training and TQM as well if you want to do well in the top right corner.
Bonus: NEVER go to corner number 1. You will likely fail your game and I haven't seen anyone do well there in BSG.
Extra Resources
These tips are not all-inclusive. As you probably already know, there are so many decisions to be made every year. I have multiple services on there, including free advice and Zoom tutoring.