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Topic created : 3 December 2011, 15:31

Last time edited : 3 December 2011, 18:36

appel42

Remarx

I have been playing for 10 days now (started from scratch, no uncle's gift)

I got an office in London and a store selling food stuff. Here are some screenshots, maybe you can give me some feedback on how I am doing and what I should be paying attention to in future.

Over the last (real time) week I had an advertising campaign for internet and press with 12000 dollar per week. I just added outdoor ads today and will be paying 52000 per week now. Is it worth it? I've got qualification 3 in advertising and 2 in commerce and management each. I did employ more people and upped their qualification in the store and the office in anticipation of more customers due to the ad campaign.

My prices are all calculated by using the following formula that I found in some other thread on here (It says 1.5 for wealthy cities, but I thought I'd make it 1.3 to have the price a bit lower and sell more):

my_price = 1.3 * local_store_price * (local_store_quality / my_quality)^0.5

Is that formula okay, or should I use another one?

I want to make my one shop profitable and then add other shops throughout the UK. i.e. I want to stay in commerce only for a while until I move into other fields.

And I suppose the "occupancy" bit in the top right corner of the tradehall is the warehouse bit of the store right? What do the other values in there mean?

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3 December 2011, 16:07

VLLord

Golden Empire

The formula works when you're a price setter (local supplier's market share is significant). But in this case you're a price taker (you may consider a meat market as an example). In addition the quality of your goods is low for London (it's a rich city and its citizens would prefer higher quality goods at higher price rather than low quality goods at lower price). So I would suggest you to move to another city. Why don't you go let's say to Edinburgh?

Consulting Services. Improve your business today!

3 December 2011, 18:32

Last time edited : 3 December 2011, 18:35

appel42

Remarx

i suppose i could go for higher quality products, but they won't be as available as low quality prodcuts i guess, so it might indeed be a good idea to go to another city. but then i would rather restart all over since i would have to build up store reputation again and i am already down to 600.000 dollar now right?

and why edinburgh? if i am looking for wealth index, why not birmingham/manchester (supposing i wanted to stay in the UK). they have a wealth index of 6 aswell, but lot more inhabitants than edinburgh, meaning more customers.

i did realize that the above formula works better for products with low market development index (like noodles). for products like bread or meat, there is too much competition from other players. i do understand that the formula is used to calculate the price in order to be able to compete with local suppliers. but how come there is a factor of 1.3 in there then, because surely that raises the price by 30% (by 50% even when using 1.5 as suggested) making my store a lot less attractive then local suppliers. if that formula is just for price setters, how should i set my prices then. without the 1.3 factor? is there a difference in price setting in areas with low market development index (mainly local suppliers) and higher market development index (other stores)? and how do brands play into the whole thing, they are not represented in the formula, but do have an influence on pricing right?

in case i do restart with a store in another city: what's the best strategy on advertising? as i said, i mainly went for internet+press now and the result can be observed as above. should i advertise more, when i restart?

3 December 2011, 19:29

Last time edited : 3 December 2011, 19:38

VLLord

Golden Empire

1. Don't restart, gained qualifications are more valuable, than $400'000. Close down your office and store and open new ones somewhere else (after detailed research I'd suggest Tallinn, Estonia).

2. To trade in big cities with a high wealth level, a high qualification in commerce is required. Until your qualification is small, find a smaller town with an average wealth level and high average prices. Tallinn can be considered as an example.

3. This formula is ok for non-competitive markets, even for your company.
Yes, it is.
Brand increases sales or higher price can be settled. No exact formula can be givven as the influence of brand is very different.

4. I'd use outdoor advertising.

Consulting Services. Improve your business today!

3 December 2011, 21:59

Jane84

TheMlya

VLLord
1. Don't restart, gained qualifications are more valuable, than $400'000.

Restart on the other hand would make it possible to win contest for managers and get points, which seem to be more useful than some qualification.

4 December 2011, 01:02

appel42

Remarx

okay i set up another store in tallinn with a few more food products. i stopped the ad campaign for the london store and the product supply and basically will just sell the majority of my left over products there to get some money out of them.

now in tallinn there is barely any player competition, so consequently the prices are really inflated. the quality of all products is really low aswell and for like 0.1 dollars more i can sometimes get quality 10 times better, so i bought really high quality stuff compared to the average, but almost at the same price. now when i use the formula without any factor in the front, then - because of the high quality - it gives an even higher price. i just ignored that for now and priced as per feeling. anyways, products wont arrive until tomorrow.

what do you think about pricing now? if i use the formula my prices will be ridiculously high, even though quality might be high.

and also there seems to be a divide. some people seem to raise their prices to fit in with the really high local suppliers prices (like 200 dollar) and some sell their stuff for like 15 dollar like in london, therefore making a lot less profit on a single item, but selling loads more (there are stores with reputation of 5 or something selling ~1000 pieces of an item, because of low prices). whats better?

i didn't restart, but if i go bankrupt within the next few days, i will Well

i'm doing outdoor advertising only now.

4 December 2011, 09:18

Jane84

TheMlya

appel42
and also there seems to be a divide. some people seem to raise their prices to fit in with the really high local suppliers prices (like 200 dollar) and some sell their stuff for like 15 dollar like in london, therefore making a lot less profit on a single item, but selling loads more (there are stores with reputation of 5 or something selling ~1000 pieces of an item, because of low prices). whats better?

Lower prices usually are better to use only in tenders, but there is some limit of sales for each product depending on the store size. If this limit is reached at the price nearly $ 150-160 compared to local suppliers' $ 200, selling at $15 would only lower your profit.

6 December 2011, 14:39

appel42

Remarx

I seem to be doing quite well, selling my full stock every turn (200 at the moment).

What does the "good safety factor" mean next to qualification of player in my store and office?

And can anyone talk me through the concept of computerization? I do understand that I atleast need as many computers as employees. But what meaning does the quality of computer have; why/when would i be interested in buying higher than 1 quality computers? Also: what happens if i don't repair the computers?

8 December 2011, 15:15

Jane84

TheMlya

Good safety factor means that you can hire more stuff and keep 100% efficiency or in other words your Top-manager's skill is not loaded fully and grows not as fast, as possible.

About computers. Higher quality of them decreases administrative load to the office and minimum of necessary workers.
But on the other hand they will require more qualified workers. Be aware of installing computers of very high quality now, cause your Top in managment wouldn't let to keep the efficiency then.

You could be intrested in buying higher quality computers, when your office can't handle its subdivisions... Quite many variations could be, for example massive advertisment in the store to make it popular, many factories in one region to avoid unnecessary transportation and customs cost, etc.

If you don't repair the computers, the efficiency of office would decrease. By the way the efficiency of the office makes an ifluence to all its subdivisions: stores sell less goods, factories produce at lower quality and amount causing rise of prime-costs, labs study technologies slower, even warehouses take more money for storage ;)

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