Presentation on theme: "RETAIL MIX This simulation challenges your ability to make business decisions affecting the sales for several periods. The group is divided into teams,"— Presentation transcript:
RETAIL MIX This simulation challenges your ability to make business decisions affecting the sales for several periods. The group is divided into teams, each of which form a sales and marketing team. You will be responsible for selling two ranges through two outlets. To keep all then numbers manageable, all prices, costs and profits are measured in a universal currency - the Account Unit (AU)
The ranges that you sell are imaginatively called Range A and Range B Product A is well established but has considerable competition. It has been sold at a mark-up of 50%. Product B is new but has few competitors. It should sell for between 50% and 100% mark-up Both ranges sell to the same types of customer but for different use. The Ranges B A
THE OUTLETS The two outlets are called Outlet 1 & Outlet 2. Currently, you only sell into Outlet 1 but are about the enter Outlet 2. Both areas are believed to be similar in terms of potential and mix of customers. Outlet 1 currently employs 8 staff each costing 5000 AUs.
Range A costs 13 AUs. Range B costs 16 AUs Fixed Overheads are 20,000 AUs each period Staff levels are decided by you for each outlet separately. COSTS AUs
USING THE COMPUTER Enter team name (up to six letters) Enter decisions –Mark-up for each range –Staff Numbers for each outlet Period Results –Unit Sales for each range, outlet and totals –Sales Revenue for each range, outlet and totals –Income Statement for period and cumulatively –Unit Sales Forecast for next period Go away to review, think and make next decisions.
ROLES & TASKS Range Managers authority to set prices for the ranges responsible for unit sales volumes Outlet Managers authority to set staffing levels responsible for outlet revenues General Manager co-ordination of the team responsible for profit
OBJECTIVES Discover how to successfully set prices and promotion to meet your goals. Work as a team. Have fun!