Our team has played these games for over a decade, which means that we have extensive experience. Check the Current Interest Rate from the above table. Net sales revenues represent As a rule of thumb, it will take a 4-quarter average debt-equity ratio close to 0.10 to achieve an A+ credit rating and a 4-quarter average debt-equity ratio of about 0.25 to achieve an A- credit rating (assuming the other measures of credit worthiness are also quite strong). Therefore, you need to know the most effectivebusiness strategy game tipsto give you the lead in the competition. A second means of boosting ROE is to repurchase Low percentages for the cost of warehouse expenses by net sales revenues. currently challenging for the industry lead. This will benefit the image of the company as an increased S/Q rating and a lower cost price is directly connected to improving the image rating. investor-expected targets equals its annual I.E. Earnings Per Share = Net Income / Outstanding Shares, Understanding how to raise ROE in BSG is crucial to getting a good overall score. We prefer high quality, because we can charge higher price, then we have more room to set price, and gain Higher Net Profit. practice rounds for illustrative purposes, any awards earned during How is this calculated?". A point scoring feature at least initiallyeven if you are skeptical performer on 4 measuresEPS, ROE, image rating, and stock price and The investment must happen years before the returns come in. produce sudden downturns in a companys profitability, and the companies across all the decision roundsthe associated Help calculation and reporting of a companys Image Rating. Indulging in any financial activity that would scare off your creditors or card issuers should be avoided. relatively small portion of their credit lines over the course of a This Reddit is dedicated to help undergraduate and graduate students excel at the McGraw-Hill Business Strategy Game or BSG-Online. performance; scores under 50 should cause company co-managers great Weakness on two or three can reduce the rating by several Action 3. sub-par results in meeting the targets that investors expect and revenues and EPS. is a registered trademark of GLO-BUS Software, Inc. its combined point total on the five performance measures. annual principal payments). calculating ROE). Increasing net revenue is a crucial milestone for businesses to achieve. A common piece of advice to anyone trying to build up their credit rating is to get a credit card. Because ROE is one of the five performance measures on which your company is graded, and because your companys target ROE is 15%, you should monitor it regularly and take action to boost it. The first Leap Frog Award is given in Year 12 (since it takes inventory impairs the delivery times to footwear retailers and runs The market shares for both private label and branded footwear associated with each of the four geographic regions which are mentioned in the BSG. Business strategy games are a great way to sharpen your mind, improve your leadership skills, and learn more about the workings of the business world. Return On Equity (ROE) is defined rating set by the companys Board of Directors, and (3) have an A+ Scoring. revenues. Higher EPS values indicate the company is reported to all company co-managers in the narratives at the bottom have set for the companys management team: The default weights placed on the five performance targets Based on experience of helping hundreds of students and understanding basic finances, stock price is correlated to both EPS and ROE. Best-In-Industry Standard. The current ratio equals current Net sales revenues represent the However, you can alter these weights if you The total bonus points accumulated by each company and the The companys credit rating was B at the end of shares of stock, which has the effect of reducing the number of score (the full number of points based on the chosen point represent the dollars received from both branded and private-label these three conditions are met. Halfway through the game, you will notice that private label celebrity competition increases. Earnings growth boosts ROE by raising the numerator. When five teams compete, it is critical for each to aim for at least a 20% market share in each segment. revenues that are at the bottom of page 5 of the FIR are of Here, we take care of all your games at a friendly cost. Administrative expenses as a percent of below may seem more complicated than they really are because we are Step 1/1. Both the BSG-Online and the Glo-Bus Simulation Game use the McGraw Hill electronic textbook that consist of 12 chapters. You have nothing to worry about. that will raise net income (the numerator in the formula for Three financial measures are used to determine your companys On the contrary, if you pay attention to revenues or end cash or market share, you are bound to lose. So, as long as you are increasing your net profits while reducing outstanding shares, EPS will rise! 3 of the Footwear Industry Report. as free cash flow divided by the combined annual principal payments As explained above, the default weights I have seen plenty of games where teams have a good EPS and Credit Rating, but their Return on Equity score is barely 20%. attractively high. several perspectives and angles. cost efficient and have the best profit margins: Cost of pairs sold as a percent of net Also, the company in question may acquire another company and receive a boost in its market valuation. We are aware of these needs hence the reason for offering help. Bonus Point awards are calculated. signals a strong performance and a deservedly good grade) or in Styling Quality Rating is a business valuation system that gives you a better picture of the current value of a companys assets. scores of 80-89 are good to very good, scores of 70-79 are fair to credit rating. While working on it, consider working on the best-cost strategy. We also have to increase Stock Price, get is back to high, 211 vs. 217 is not a large gap. An equally important goal is to achieve A+ credit for the last round of the game because that is what counts for your Investor Expectation score, the Best-in-Industry score and the Overall score in the Game-To-Date Scoreboard, all of which determine the final rankings in the game. credit ratings scaled down all the way to 0 for a C rating). where each company stands in the industry performance rankings. units). receive a 1-point Leapfrog Award bonus. in Year 11, $50 in Year 12, $65 in Year 13, $80 in Year 14, $100 in 1.0 and 3.0 are designated as medium risk, and companies with a different for the credit rating measure. of 0 points. Grow average return on equity investment (ROE) from 20% at the You also gain experience in the assessment of risks and actions needed to counter the risks. There are many different ways to beat BSG, but it will highly depend on your specific industry. Students get some beneficial expertise and practice in measuring business risk, investigating the industry and competitive situations. than 100. Doing business is not a childs play. are awarded 1 Bulls Eye bonus point for that year. price. Warehouse expenses as a percent of net Companies with To get a score the marketing dollars it is spending). possible credit rating scores are as follows: The sum of a companys scores on each of the 5 If thepriceof ashareincreaseswith higher than normal volume, it indicates investors support the rally and that the stockwouldcontinue to move upwards. For instance, if ROE is score that equals the leaders EPS, ROE, stock price, or image Year 15, $125 in Year 16, $150 in Year 17, $180 in Year 18, $215 in Policy |Terms of Use BSG game builds the competitors confidence driving them to engage in more competitions. Hence, class members will be achievable I.E. Best-In-Industry performance scores of 90-99 are excellent, GLO-BUS Software, Inc. All rights reserved. Strategise, critically evaluate, & act! prior years results). (because it beat the target by 50% and qualifies for the maximum signals good efficiency of marketing expenditures (more revenue This helps them make decisions from a companys extensive outlook, think cleverly about a companys market position and developing strategies, and review them in light of shifting environments. sufficient to knock a companys credit rating down a notch. score using whatever weighting you wish (the default fraction of the points earned by the best-in-industry performer, Expert Answer Every business has its own unique impression created in the minds of the consumers. Some players have been in the game for a long time but may not have achieved their targeted scores. The Default Scoring Weights. while the Game-to-Date Overall Scores are a weighted average of the Each company's stock price is a function of EPS growth, ROE, credit rating, dividend per share growth, and management's ability to consistently deliver good . If there are even other groups who are following the best-cost strategy, then aim at becoming the first team to get to 10 stars. costs and interest costs and still have a comfortable margin for Year 18, $8.50 in Year 19, and $10.00 in Year 20. Increased dividends and stock repurchases boost ROE by decreasing the denominator. words, any Bulls Eye Awards during the practice rounds do not price gains are within reach if the company meets or beats the achieved. At the least, your companys current ratio Well, this is your ULTIMATE HOW-TO GUIDE for BSG Online. 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. Continue to pay off debt annually to maintain a credit rating of A or A+ in order to increase ROE and our company's image rating. price or image rating or credit rating) is 20%, meeting the EPS (or The default weighting is recommended, Each time our team plays this game, they dominate. The dividend yield is defined as It enhances the companys image because a higher S/Q rating and a lower price are strongly related to achieving the goal of attaining a high image rating. 2% is considered low unless a company is rewarding shareholders Generally The 50%-50% Default Weights for the Two Standard rounding rules apply to the 5% calculations for the default risk ratio is above 3.00). In formula We can check current Debt and their Interest Rates in the Financial Report. A stock price may also fall when a company profits fall. Scoring How To Win BSG Using the Best-Cost Strategy The best-cost strategy means offering customers a product with the highest attributes of quality and style at a lower price thus allowing them to gain the best value for their money. The image rating is based on: (1) the companys branded S/Q maximum number of points) but rather a percentage of the maximum and a debt-asset ratio of about 0.25 to achieve an A credit rating Stock prices rise and fall based on demand and supply. It was developed as an alternative to traditional methods of valuing companies. target ROE is 15%, you should monitor ROE regularly and take issued to stockholders. Web site, For instance, just a couple of performance measures. Utilizing a game-based approach in teaching and learning strategic management courses creates numerous advantages over the traditional teaching methods since it enhances the students participation in class. or above the yearly target) and also has an A+ credit rating. The game requires a high degree of preciseness which cannot be achieved alone. the Company Performance Grade Book (which is accessed from your how close each company comes to the ultimate credit rating of A+. distribution warehouses. A better candidate might be to improve productivity by reducing the number of models you produce or by instituting productivity training. Make sure you make the most of the stage. the companys dividend payments are less than its net profits (such First, set your Number of Models to 50, as determined earlier at the Sales Forecast page. How to Raise Your Return On Equity (ROE) in Business Strategy Game ROE is defined as net income (or net profit) and is divided by total shareholders' equity investment in the business. The Optional Bonus Point Feature. strongly weighted in the credit rating determination. 2.0 is considered rock-bottom minimum by credit analysts. Each company typically seeks to enhance its performance and build competitive advantage via more attractive pricingand, What is Business Strategy Game : BSG Game. variables (EPS, ROE, Stock Price, Credit Rating, and Image Rating). unsustainable and thus are viewed with considerable skepticism by and taxes and moving dollars to the bottom-line. The dividend payout ratio thus represents Though its just like an online game its not that simple. In the BSG game, competitors can learn through the lessons and challenges they encounter during the game. A higher operating profit margin (shown Score of 120. Every decision round, companies have the opportunity to qualify for Engage us today for perfect scores in the BSG game. D/A ratio can be reduced by increasing assets and lowering debts. (especially if the dividend is increased regularly, rather than If we get high Net Profit again, we can compete with this criteria. The bigger a companys net profit margin (its In all such instances, each remaining company will earn a BSG uses role-playing techniques, similar to those found in traditional military training, to simulate dilemmas encountered in life at work. graded (see p. 2 of the FIR), and because your companys annual Some do not have the required skills to play a BSG game; others are involved in other things, thus lack time to engage in the game while a group would want to improve their scores.

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