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Topic created : 4 January 2012, 23:56

beechy

K.B. International

Hey there i have been suffering from slight losses on my realms lately.. anything from 50k-2.5m.. i was wondering if i should use advertisment to try and incourage customers to my stores and purchase products from me?
if so how much would i invest into advertisement?
Also i would like to know why when you want to buy something to put in your store.. the items that you try to buy are never available? and the only ones that are, are so high that you could never make any profit from them.. also sometimes ill be selling like 2k of such item.. and then few days later im selling like 50.. even the the prices haven't increased or anything.. and then my stores are not making so much money...

if anyone could help me turn around my business i would appreciate the help Very we!

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5 January 2012, 03:28

SignGuy

SignGuy Limited

tough one. I wish I knew more so I could help you. Out of my 5 stores I have one store that is this way and I can't seem to make it as profitable as the rest. In my situation I would say choose a different city for your store, but don't listen to me dude i'm a noob. Very we!

5 January 2012, 21:05

Last time edited : 5 January 2012, 21:08

Melchior2008

RoMa Inc.

Market research is important to have high margins on your sales. You're not forced to stick with a store which doesn't bring profits. Plus, it's better to have stores with only 1 department.

Store advertisement is the key to have more clients So-so

Pay for it what you can afford.

As for supplying your stores, it happens that the goods you ordered aren't available at the end of the day, even if you have seen them available earlier. You can diversify your sources of supply to help avoiding shortage, and use a warehouse to have some stocks. The best way to ensure stable supply is to produce your own products. It will also help you have lower prices. For a starting company it's costly to have factories, but you can start with a small one to see how it works.

The high prices of supply on the wholesale market on some products should force you to find new markets for retail, or to change the products you sell.

6 January 2012, 13:53

JustNash

Premium Brands

adding to this great advice by Melchior, I would like to say:

* when you have some cash laying around that you cannot use to grow your company due to qualification restrictions, use it to buy cheap products on the rare occasions you come across them and store them in your warehouse. They are probably the best investment you'll come across + you always have supplies for your stores because you'll find that supplies for certain products regularly dry up, depleting your inventories.

* as for producing your own product: bear in mind that there is an opportunity cost involved. It is fine to sell a product to yourself at prime production cost, but if you just add a small margin in retail and end up selling it there at wholesale prices (or even lower), then you might as well just sell them to a third party directly from the factory. Personally, I check my internal prices from time to time and if my production is not exported (ie there is no customs duty), I set my internal prices at wholesale level.

* if your sales volumes drop, this might be due to your selling price being agressively low. Others will adapt their prices to yours, shifting the supply-side and hence lowering either your selling price or your sold volume. It might also have to do with internal affairs: quality has dropped, service level dropped, efficiency worsened, ... Or there just might be a tender going on :-) In my case, I usually found it to be over-agressive pricing.

* retail pricing: I want to be able to add at least a 30% margin to my wholesale purchasing price of any product. If I cannot obtain that for most products within a store, I just shut it down. For my comfort, I have chosen to stick to 1 or maximum 2 departments. For example, on Mary, I'm only in Clothing (random choice, didn't research it). If I cannot sell my clothes with a decent margin, I close the shop and look for another city. But, to be clear: it is much better to shift departments as well. You'll come across far more profitable opportunities that way.

7 January 2012, 01:05

beechy

K.B. International

surely just closing down a store and opening a new one in a different city is a costly idea? wouldnt you loose the stock that you have already purchased for the store that you want to close?

also what your saying is that if my prices are too low my sales will fall because other people will drop their prices to undercut me?..

and im really stuck when it comes to market research.. i try it and all that happens is it tells me what is needed to make that product.

on the factory side of things.. i find that mills and bakerys seem to be making a loss every time.. this due to me not using my own farm for grain? in spain for example.. the flour is like 2.40 and bread costs me like 4 to make and then people only buy bready for like 0.80 or so.. how am i supposed to compete with that?

in regards to your replies, i say thank you and hope to receive more replies soon!

P.S is there anyway i can make deals with other people in game for permenant supplies of stocks etc? or do people not bother with stuff like that?

7 January 2012, 02:42

JustNash

Premium Brands

beechy

1. surely just closing down a store and opening a new one in a different city is a costly idea? wouldnt you loose the stock that you have already purchased for the store that you want to close?

2. also what your saying is that if my prices are too low my sales will fall because other people will drop their prices to undercut me?..

3. and im really stuck when it comes to market research.. i try it and all that happens is it tells me what is needed to make that product.

4. on the factory side of things.. i find that mills and bakerys seem to be making a loss every time.. this due to me not using my own farm for grain? in spain for example.. the flour is like 2.40 and bread costs me like 4 to make and then people only buy bready for like 0.80 or so.. how am i supposed to compete with that?

5. in regards to your replies, i say thank you and hope to receive more replies soon!

6. P.S is there anyway i can make deals with other people in game for permenant supplies of stocks etc? or do people not bother with stuff like that?

1. opening and closing stores isn't as expensive as you might expect. Although, obviously, don't open a shop on day 1 and then close it again on day 2 to open another one. You won't have the resources to finance that. As for the inventory: you can always send it to a warehouse.

2. exactly

3. if you're looking at those pages, you're close Well

there are reports about city retail that offer you useful intel and then in the same area, there is a tab for products where you can see what the products cost to purchase.

4. I don't know anything about that sector (I'm in clothes), but before you open a factory, especially in the beginning, you should also make a budget for it. Calculate the costs, determine the selling price. See what's most profitable.

5. you're welcome

6. I know some people have good agreements. But, I guess it happens more between more experienced players. The most interesting cooperations are supposed to be between players that started at about the same time and of the same size. :-)

7 January 2012, 19:23

Last time edited : 7 January 2012, 19:23

Melchior2008

RoMa Inc.

beechy

on the factory side of things.. i find that mills and bakerys seem to be making a loss every time.. this due to me not using my own farm for grain? in spain for example.. the flour is like 2.40 and bread costs me like 4 to make and then people only buy bready for like 0.80 or so.. how am i supposed to compete with that?

Selling bread on the wholesale market isn't very profitable, if profitable at all, especially for low quality bread. The solution would be to sell this bread yourself on the retail market. And then the market research can help you find the good markets for your bread. You can do your market research for bread by going to : http://virtonomics.com/mary/main/globalreport/marketing/by_trade_at_cities/1506/ . There you can watch the market detail for every city and make yourself an idea about business opportunities.

7 January 2012, 19:26

Melchior2008

RoMa Inc.

The link doesn't seem to work. But if you copy/paste it in another window, it does.

7 January 2012, 19:36

Dutchsmurf

Smurf International

Proper market research is probably what takes the most time in this game. Determining what products you can sell for which price in which city is very important, but also very time consuming. After playing for a few weeks it will get easier. You will develop a general feel for prices and will be able to identify interesting markets easier. Like you will know that bread of quality 5 is available for prices around $2. So if you find a city where bread of quality 5 is sold for $20, that might be an interesting market.
Of course your shops won't get far if you sell just bread, so next you look into other products of the same category. In this case that would be foodstuff. So you look at the selling price of flour compared to what it costs to buy it and find another profitable product. Do the same for some other foodstuff and review your results. Now decide if it is worth selling foodstuff in that city.

As far as I know there isn't a faster way to do it. As I said, you will get a feel for it when you play longer. You will recognize certain products being overpriced compared to other cities and the like. But it will always take time.

8 January 2012, 02:56

beechy

K.B. International

thanks for all your help everybody, i will work on my market research! ;)
as of now my company seems to have stabilised which i suppose is better than loosing money each update. as of now im creating 150k profit. I hope to build upon this.. i will keep creating stores all over the place.. but first i suppose its going to be a long lesson of market research....

As for advertisement.. the more i spend the more customers right? and as a result... i should get more sales? wouldn't it just be best to put it out on max advertisement to increase custom?

8 January 2012, 15:48

JustNash

Premium Brands

be careful:
* you need to have enough cash in your account to purchase the products you are looking to sell, so don't invest your last dime in new stores. It's better to have a safety buffer. Bear in mind that not every day offers the same amount of sales. What if the next update, online half your normal amount gets sold? What if someone enters your market and ruins margins? If there is a tender in your city?
* you cannot advertise endlessly, you are limited by your qualification in marketing. At this point, that maximum is probably a lot lower than the maximum that the system has installed for marketing effectiveness.So, yes: spend as much on marketing as your qualification allows.

8 January 2012, 22:00

Dutchsmurf

Smurf International

With marketing it is more a case of spend as much on marketing as your wallet allows.

I have never run into a situation where I couldn't do more marketing because of my qualification. My marketing qualification is also growing the fastest, so I doubt it will be a problem there. Usually more marketing puts a higher strain on your offices, so you might get problems with your management qualification. But generally speaking I think money is a bigger constrain.

9 January 2012, 02:12

beechy

K.B. International

thanks for all your feedback, i have another question for you all..

my store is now at size 10,000sqft and i could put it up to 100,000sqft.. but obviously the rental cost it 10x the amount.
does this bring 10x the customers? or is that me being too simple?

and is it worth moving the store

City centre or Fashionable district?

9 January 2012, 12:02

redhakaw

RedHakaw Corporation

^city centre,

pay attention to the comment (the one that shows, high, very high, low, very low, elite)
if it's Elite, don't enlarge your store, you are doing fine. wait for it to change to very high, if you think you have enough employee, enlarge it.

it's good to have all stores at elite.

sometimes in a store you have 10000 sqft, but have 100 emplyees, instead of max.

the determinant for enlarging your store is when the visitors increase.
visitor increases if you are advertising well to increaase popularity.

moving from areas (city centre-fashionable) will decrease your popularity tremendously.

9 January 2012, 18:08

beechy

K.B. International

so i opened a new store.. i stocked it with goods and on the day that it actually brought in sales it took 800k+ profit but the feedback is "very high" so i just moved it to store size 100,000sq ft and put a bit more advertisement to it?

tell me that was the right thing to do.. i mean the rent on the store now is more than my profits but this will increase correct?

9 January 2012, 20:09

JustNash

Premium Brands

beware: a larger store will attract more customers. More customers will require more staff. Can you handle that (top manager)? Most of my 100k m² stores require about 1000 workers.

Service level: I'm not at all convinced you can maintain an elite service level in every 100k m² city center store... (I'm also still learning, and haven't actually tried to do that) If you can sell half a billion's worth a day, but have to sacrifice the service level dropping to very high, that's not shabby either :-)

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