Kiaros Company Limited is a private company that deals with production, marketing, and selling of footwear to the world. The shoes that are being supplied by this company have good quality, and also it is affordable, and many people can be able to buy it. Various strategies are being used by the company to maximize profits in this competitive world. The business strategy game is composed of three stages of the running of a business, strategic decision making, gaining profits, and also the score in the market. This report discusses the business strategies that have been put in place and also the profits that have been made by the company in 7 years since the game started in year 11 and ended at year 18.

Chapter 2: Company Overview and Strategy

Vision and Mission

The mission of the company is to be able to make good footwear, which is affordable for every individual. The vision of the company is to make good quality footwear to its customers all over the world. The mission and vision have helped the company in meeting the short and long term objectives.

Competitive Strategies

Table 1

Competitive strategy refers to a plan that lasts for an extended period so that the company can gain a competitive advantage over the competitors in the industry. Michael porter classified the competitive strategies into four genetic categories, which include: cost leadership strategy, best cost strategy, differentiation strategy, and also the focus strategy. This is clearly illustrated in the diagram above. The source of the company’s competitive advantage is the differentiation strategy, whereby the company aims to produce a variety of shoes that meets the needs of the consumers. By doing this, the company can survive in the market. Another strategy that the company has focused on is lowering their prices than of those of their competitors so that they can get as many customers as possible. These strategies are being reviewed annually, and also, adjustments are being made to improve the overall outcome. The main reason why I choose these strategies for the company is that a person can get as many customers as possible despite the competition that exists in the market.

Overview of the company

Kiaros Company Limited has to focus on selling, marketing, and even producing as many quality and affordable shoes which are designed to fit all the population. There are many rivals in the market, such as Adidas, Nike, among others that exist in the market, which has the largest market share. The market share for Nike brand in 2017 was 21.1 percent of the United States, and Adidas had less than 5% of this market. This is a clear indicator that competition that exists in the market is a tough one. Some of the regions where the market exists include: Europe-Africa, Latin-America, and each region have its specific business strategy to meet the needs of that market.

The combination of lowering the cost and differentiation benefits, and it helps a lot. Most of the customers in these regions want to have good quality shoes, which provides excellent service at an affordable price (Lewis, 2017). Some of the factors that drive the market, such as an increase in the size of the population, which increases the demand for these footwear.

Chapter 3: Stages of decision making

The company made various decisions on different stages. The beginning starts from year 11 to year 12, mid-game starts from year 13 to year 16, and the end-game starts from year 17 to year 18.

Beginning (Year 11- year 12)

During this stage, various decisions were made as a result of the business strategies of the company. There are various challenges that the company has faced, such as inadequate resources to use in manufacturing many shoes, and the company decided to focus on an advertisement, pricing, and production.

Advertisement at this stage was inevitable because it is one of the ways of making the products so popular and gaining the market share despite the competition that exists (Kong et al., 2019). Various low advertising strategies were adopted by the company, such as brand advertising. The estimated total cost of the brand is about 20,000 dollars. From table 2, it shows that the estimated cost for advertisement was almost accurate during the two years.

Table 2

	Year 11	Year 12
The estimated cost of advertisement (Dollars)	20,000	20,000
Total costs spent (Dollars)	18,500	20,5000

Production

In the production of these shoes, the company decided that it will use the cheapest resources that are readily available to avoid unnecessary costs that can be avoided (Mansouri & Hosseini, 2018, 56). This thus helps in reducing the cost incurred by all means.

Pricing

Two types of marketing are involved, which include internet marketing and also wholesale marketing (Islami et al., 2020, 3). The target profit margin of the company is about 30 percent, and the overall decision of the price was quite higher than the assumed competitive price.

Mid-game (Year 13 – year 16)

Various actions were needed to take place so that the company can get a lot of profit and also confidence from its investors. One of the decisions that were made was adjusting the selling price of the shoes so that many customers can be in a position to afford it. The average price that these shoes were being sold was about 3 dollars in each region, which was moderately fair for all the customers. The prices for the whole were also reduced than those of competitors because it is one way of winning more customers and making our brand more superior to other known brands in the market. During this period, the advertisement cost was increased from 20,000 dollars to 25,000 dollars so that the company can attract more customers. A lot of training was conducted among the staff so that they can be able to be competent in producing a better version of the shoes.

End-game (Year 17 to year 18)

From the findings that have been obtained seems that the operation of this company is completely the same as the mid-game. One of the decisions that were made during this stage includes the fact that the price was quite lower than that of its competitors, which means that there were making a lot of sales during this period. However, there are slight differences that were being noted during this period (Omsa et al., 2017). Although the price was lower than the competitors, it was a little bit higher than the other years, which raised the net income. This is one of the ways the company increased the profits there were making during the end game, which is a good thing at all.

The company also borrowed more loans to use in advertising about the product being produced. This is a kind of investment because, in return, the company managed to gain more customers at the end of the game, thus gaining more profits.

The market share had increased because many customers were buying our product since they had started knowing more about it. As market share increases, the profitability also increased greatly due to an increase in the number of customers (Hyvari, 2016, 110). Actually, at this point, the company was doing much better than when the game started, which is generally a good thing. It is doing much better than the time the game started.

Final results

As the last year came to an end, the company’s performance was average. The expectations score for the investor is 75, 55 is the best-in-industry score, 70 is the weighted average score and the bonus points is 2. The ranking among 6 competitors is at 4. The company’s credit rating was B+ since year 16 to year 18.

Table 3

Rank	Company name	Investor expectation score	Best-industry score	Weighted-average score	Bonus
1	s	80	80	86	5
2	t	78	73	73	5
3	u	76	69	73	3
4	Kiaros Company Limited	75	55	70	2
5	x	74	56	67	0
6	y	74	54	67	0

During this years, the company have had various social responsibilities role in the society such as donations to various individuals. In the final year about 15,000 dollars were given out. The styling quality were improving annually because there are various strategies that helped the company improve on that issue.

The facility space available in all the four regions were 3,000 pairs plus. The production equipment that was available in year 18 in total is 34,000 pairs. Thus the net investment spent in purchase of the production equipment in all the four regions is 581, 737. The production capability in total is about 34,000 pairs. The number of workforce by year 18 rose to 7,918 and even the number of supervisors rose by 2 as compared to the previous years. The production costs for the branded products is 703, 156 dollars in total.

The administrative expenses is 51,992 while the marketing expenses is 130,128 in year 18. The contract offers to private sector is 3,358 pairs and which was produced or sold is 3,388 pairs. The gross revenue for the internet sales is 283,732 dollars while the gross wholesale revenue is 921, 961 dollars.

Reflection

I am happy that after playing this game, we manage to get the success of the company. This game is not quite easy but it needs a lot of competition. Through the vibrant teammates who have been part and parcel of this success did their best. They have always come up with different ideas that have helped the company to grow in different ways which is a good thing indeed. I would like to thank them so much because they have played an important role a lot.

Playing the game has instilled various knowledge that I was not aware of. Strategic planning is essential for every business success. If people cannot be able to plan successfully then they are not able to grow or make any step in life and even it can eventually collapses. A CEO or manager plays a very crucial role in the industry and make many plans that help the company grow and gain more profits. Best decisions are achieved by consulting with other staffs because teamwork is very good in terms of coming up with different decisions that can help business grow.

Chapter 4: key learning points about the strategy

Importance of assessing the macro-environment

PESTEL framework helps to identify various factors that affect business in one of the other. For instance, this framework identifies opportunities that are good for business and threats, which are not suitable for business. Thus once the company identifies its opportunities, then it uses the opportunities that have been identified, such as lowering the price to get more customers globally, which worked out so well. The threats that exist in the market, such as competition, helps the company to reduce its effects.

Importance of assessing the company and its rivals

Assessing the company is important because, as a customer, you can identify the strengths and weaknesses of the company and makes changes that are necessary so quickly. Forces are also useful in assessing the competitive advantage of the company and even its competitors (Nemanich, 2019). Competition is inevitable, but there some ways the company can gain negotiation power by lowering the price of its products than the one for its competitors. The five forces of Porter also has the potential of assessing the competitors and even the competitive advantage of the company.

Complexities of running a company

Running a business is not that easy and there various issues that usually come up such as the expectations of those individuals who are investing, the image of the brand and also the amount of sales that the company can make during a certain duration of time (Goralski & Luoma, 2016). The company should always aim to create a balance of various factors to maintain its competitive advantage. Loyalties of the company are raised by putting into considerations the welfares and importance of stakeholders

Leadership and control

The chief executive officer has a vital role to play in the company, and he is the most important person because he leads the company in the way it should. He also deals with different situation that arises. He is the one who is responsible for the employees, stakeholders, and maintain the profits of the company.

Financial Management

Financial management refers to managing various finances that come in and goes out of the company. Some of it includes borrowing loans to cater to the gaps that exist in the business, such as the advertisement costs, which need a lot of money (Porter, 2016). These loans are settled by using the profits that the company has slowly by slowly until the time they are cleared. The company may spend more money on one aspect, and to balance this, then the company should spend less money on another aspect.

Marketing

Marketing is one of the essential things every company needs. Advertising being one of the marketing strategies is so crucial because it one of the ways the company is gaining a lot of customers, thus making more profits. The company, therefore, has the responsibility of controlling the money that is being spent on advertisements depending on the available resources.

Distribution

Distribution strategy is also essential because the company can know ways in which their products can reach their customers. Less money should be spent here because it can consume all the profits that should have been gained in return (Faith & Agwu, 2018). This strategy thus determines the route at which the products will be availed in the different warehouses located in different regions.

Working with others as a team

Working as a team is so important because many things can be achieved, which are beneficial to the company. The team can come up with different ideas that help the company to become the best in the market (Alvarez et al., 2019). The best decisions about the company can also be made through the team.

Chapter 5: Underlying strategic principles

The company had its vision and mission, which so important because it guides the company in the direction it should go. This even assists in formulating the essential company strategy. Therefore, the company needs strategic thinking, strategic visioning, and also having strategic management, which is required whenever the decisions are being and some changes. Strategic thinking is critical because it helps the company move in a certain direction and achieves both short term and long term goals that have been put in place (Schaltegger & Horisch, 2017, 259). The available resources can be managed and utilized effectively until the company achieves its estimated outcome. When a company has strategic measures, all the workers in the company should work together and also aim to be on the right track so that the organizational goals can be achieved.

Conclusion

In conclusion, the Business Strategy Game Simulation report is good because it provides an opportunity whereby there are rapid changes that occur in the business. It has also given me the experience of making various decisions for the company and also running a company as part of the team. The company can do so well, depending on how it is being managed (Bashir & Verma, 2017, p. 7). Companies should always embrace teamwork because, with teams, there are a lot of things that can be done, and people can be able to make as many changes as possible, which are beneficial to the company. The company management should also have strategic plans for the company so that the company can be viable and gain a competitive advantage despite the competition that exists in the industry. Through running this virtual company, there are a lot of things that I have learned.

References

Alvarez, M., Machado, E. C., & Diza, N., 2019. Business Strategy Game (BSG).

Bashir, M. and Verma, R., 2017. Why business model innovation is the new competitive advantage. IUP Journal of Business Strategy, 14(1), p.7.

Faith, D. O., & Agwu, E., 2018. A review of the effect of pricing strategies on the purchase of consumer goods. International Journal of Research in Management, Science & Technology (E-ISSN: 2321-3264) Vol, 2.

Goralski, M. A., & Luoma, P., 2016. Competitiveness and Sustainability in a Changing Global Landscape: The Business Strategy Game Simulation. In Competition Forum (Vol. 14, No. 1, p. 89). American Society for Competitiveness.

Hyväri, I., 2016. Roles of top management and organizational project management in the effective company strategy implementation. Procedia-Social and behavioral sciences, 226, pp.108-115.

Islami, X., Mustafa, N., & Latkovikj, M. T., 2020. Linking Porter’s generic strategies to firm performance. Future Business Journal, 6(1), 3.

Kong, J., Rae, H., Thomas, C. J., & Hernandez, A. J., 2019. Strategic Management: The Business Strategy Game.

Lewis, R., 2017. Porter’s Five Forces of competitive advantage.

Mansouri, S., & Hosseini, M., 2018. E-commerce, Marketing Strategies and a Variety of Pricing Methods. JOURNAL OF MANAGEMENT AND ACCOUNTING STUDIES, 6(02), 55-59.

Nemanich, L. A., 2019. Ahead of the Chains: Business Leadership Insights From the Game of Football, by Matthew F. Prostko.

Omsa, S., Abdullah, I. H., & Jamali, H., 2017. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances.

Porter, M. E., 2016. The New Competitive Advantage.

Schaltegger, S., & Hörisch, J., 2017. In search of the dominant rationale in sustainability management: legitimacy-or profit-seeking?. Journal of Business Ethics, 145(2), 259-276.

Kiaros Company Limited

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