Globus Report Essay

2870 Words Mar 1st, 2013 12 Pages
Globus Simulation Game Report – Shahab Niaz (Company D)

Introduction

The energies of this report shall be directed towards the documentation, explanation and analysis of our group strategy in playing the Globus Business Strategy Game, and also the outcomes of our decisions. In doing so, aspects that I will attempt to analyse and explain our decisions relate to production design, marketing, assembly (for both entry-level and multi-featured cameras), compensation and labour, discount bids, corporate citizenship, finance and cash flow.

A breakdown of our overall long-term strategy as well as the year-by-year decisions and review will follow in order to assess how well we met investor expectations as well as attempting to beat
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We aimed to win market share by appealing to cost-conscious or price-sensitive customers, which we felt that the majority of consumers consisted of. This would be achieved by having the lowest prices in the target market segment, or at least the lowest price to value ratio (price compared to what customers receive). To succeed at offering the lowest price while still achieving profitability and a high return on investment, it was evident that we had to be able to operate at a lower cost than our rivals. We aimed to achieve this goal though a combination of two methods, the first being achieving a high asset turnover. In the manufacturing of our cameras, we wanted to achieve the production of high volumes of output. In theory this approach meant fixed costs would be spread over a larger number of units of the product or service, resulting in a lower unit cost. We hoped to take advantage of economies of scale and experience curve effects[3]. We hoped and realised that higher levels of output both required and resulted in a higher market share, and created an entry barrier to potential competitors, who may be unable to achieve the scale necessary to match our low costs and prices.

The second aspect involved keeping overheads low by having low direct and indirect operating costs. This was achieved by offering high volumes of standardised products (more so for the entry level cameras but also for the multi-featured ones), offering basic no-frills products and

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