Capsim Guide 2024 - Free Winning Guide and Tips to Win Capsim 2024 and Capsim 2025 (2024)

Here Are The Answers To Capsim FAQs MBA Students Ask About Capsim Simulation Game

Q 1 How To Win Capsim?

Make it rain in the earlier rounds by investing heavily in product invention, capacity, and automation, because it takes money to make money.

Q 2 How To Increase Days Of Working Capital In Capsim?

The concept is to increase the amount of current assets and/or to decrease the amount of current liabilities.

Days of Working Capital = Working Capital / (Sales/365)

Working capital can be improved by:

• Being profitable
• Issuing stock for cash
• Replacing short-term debt with long-term debt
• Selling long-term assets for cash
• Settling short-term debts for less than the stated amounts
• Collecting more of the accounts receivables than was anticipated
• Reducing the balance required in the current asset account Allowance for Doubtful Accounts

Q 3 What’s The Best Position On The Perception Map?

Capsim Questions About Repositing Products In Capsim

This section includes Capsim questions based on repositing products in Capsim.

Q 4 How To Reposition Products In Capsim?

Changing a product size and or performance repositions a product on the perceptual map. In fact, improving a product performance’s and decreasing the size moves the product towards the lower right on the perceptual map.

Q 5 What’s The Importance Of Repositioning Products In Capsim?

Products in segments must be repositioned to keep up with the drifts by making them smaller and faster each year. Positioning affects material cost. Therefore, the more advanced the position is the more expensive the cost of materials will be. In addition, repositioning also cuts products age in half.

Repositioning cost may include:

• Low-end position cost $1.00
• High-end position cost $10.00
• MTBF 1,000 house add $0.30 to material cost

Improving positioning and reliability and reliability will make a product more appealing to customers, however doing so increasesmaterial costs.

Q 6 What Effect Age Revision Has On A Product?

Age revision is the age of a product after the product has been updated. This is one way you can manipulate the product cycle of your products in the game. So if you want an older product to look newer then reposition it. However, understand when a product is repositioned on the perceptual map during the year its age will be cut in half. If no repositioning is done the product will age by one year.

Generally, you would allow products to age into whatever segment you want to dominate and keep the products in that segment by repositioning the product based on what the customers in that product segment want.

For example, if your strategy entails dominating the low-end segment then you would just allow the products in the other segments to drift to the low-end segment. Plus you would invent products in the earlier rounds to replace these low-end products if your intention is minimizing Research and Development expense.

Remember, once low-end products drift out of the dashed circle customers will no longer buy them. Thus, to keep on dominating that segment you will require new low-end products. If you fail at supplying the demand you created your competitors will be happy to take your market share.

Therefore, you could either reposition the product by revising the product or you can let that product drift out of the dashed circle then replace it with one of the products you invented in the earlier rounds. However, for this to work you must invent products in the earlier rounds because it takes a while for new products to drift/age into the low-end segment. So plan accordingly.

Q 7 How Do Products Drift Or Age In Capsim?

Q 8 How To Invent Products In Capsim?

The name of invented products must start with the first letter similar to the products already created by the game. Example, if you are on team Andrews and you decided to create three products they should be labeledActed,Awag andAbat.

Q 9 When Should Capacity Be Purchased In Capsim?

Production department must purchase production capacity to build the new product one year in advance. Invention projects take at least one year to complete. Example, if one product was invented then capacity would be ordered as follows:

Invent Product Acted

In Year 1: Schedule Acted for manufacturing and Purchasecapacity for Acted

Year 2: Launch Acted

Q 10 What’s The Best Capsim Automation Strategy?

• Traditional: 8-8.5
• Low-end: 10 towards the end of the game
• High-end: 6-7, and 6.5 for other product segments

Note, increase automation slowly because you need Total Quality Management (TQM) module to become effective at the beginning of the fourth round.

Q 11 Do You Have Capsim Cheat Sheet To Download?

No cheat sheet available. However, questions are welcomed.

Q 12 How To Increase Leverage In Capsim?

You issue stock and bonds.

Q 13 How Do You Calculate Capsim Sales Forecast?

Last year’s sales units multiple by the segment growth rate for the upcoming year. Therefore, if you ran out of stock in the previous year adjust the sales unit by adding the additional inventory you would have sold if you didn’t run out of stock. Then multiply that figure by the new growth rate for the upcoming year for that product segment.

Capsim Sales Forecast Calculation Example

So for example, if you in 2018 you sold 2,000 units in the high-end segment but your stock out was 100 units, and the growth rate for the upcoming year is 5%. Now assuming everything stays relatively the same as last year then your sales forecast for the upcoming year 2019 would be:

• [(2,000 units+100 units) x 0.05] + [(2,000 units+100 units)]= $2,205 OR
• (2,000 units+100 units) x 1.05 = 2,205

Note, calculating the sales forecast is only the first step in predicting the sales forecast. As always things never stay the same, so there are other factors you need to consider then adjust that number base on these factors.

How To Adjust Capsim Sales Forecast To Reflect The Impact Of External And Internal Factors

For instance, if are you currently dominating this segment and based on your competitor’s last year performance there is no way they will be able to retaliate then 2,205 might be too low. Which means that there is a possibility you might stock out.

In this situation consider the overall demand for that product segment then adjusts sales forecast accordingly.Word of caution: don’t forecast sales units over the total demand in any product segment even if you are dominating that segment.

However, if you’re not dominating that segment you wouldn’t want to go up above your original calculated sales forecast. You also need to consider capacity, labor, and finance. Do you have enough capacity, labor, and finance to produce these units? In brief, always ensure you are also financially capable of producing products.

Overall, your sales forecast starts with a calculation. However, this figure is later on adjusted based on your competitor’s past performance and whether you believe they can retaliate, plus your ability to produce these units.

Q 14 Do You Have To Create A Capsim SWOT Analysis?

To keep you on track create a SWOT analysis. In addition, adjust the SWOT analysis at the end of each round to reflect your company’s current positions externally and internally.

Q 15 How To Pay Bonds Due In Capsim?

All bonds due at the end of the year are automatically converted into current debt. This debt is paid on January 1st. However, ensure you have funds available to make the payment when it is due to avoid triggering an emergency loan.

Capsim Questions About Capsim Emergency Loans

This section includes Capsim questions based on Capsim emergency loans and how to avoid Capsim emergency loans.

Q 16 What Are Capsim Emergency Loans?

Firstly, avoid emergency loans at all cost.In brief, the Capsim game gives you emergency loans when you manage cash poorly. Therefore, Capsim emergency loans affect your stock prices even when your company is profitable, plus the interest rate is just ridiculous – it’s 7.5% plus whatever the current debt rate is. In general, once againavoid emergency loans.

Q 17 How To Avoid Capsim Emergency Loans?

Ensure you have enough cash to cover short term debts for the upcoming rounds before starting that round. If you realize there is a chance of you running out of cash at the beginning of the next round issue more stocks to raise funds. In addition, try your best to meet your sales projections byforecasting properly then producing products customers want better than your competitors. In general, excessive inventory and capacity and automation purchase without proper funding usually trigger Capsim emergency loans.

FREE PERSONAL SUPPORT

FREE WINNING GUIDES AND TIPS

FOR ROUND 1 & ROUND 2 (FREE)

WIN ALL ROUNDS

NEW WINNING TIPS 2018

FREE Excel File

for R&D,

Sales forecast

and Production

New update 2020

Capsim Tips For Each Capsim Module

Use these Capsim tips as a guide to help you formulate your own strategy. Good luck!

Capsim Tips For Capsim Research And Development Module

• Research and development decisions directly impact your marketing and production plans.
• Marketing andResearch and Development decisions address product repositioning on the perceptual map, the number of products in each segment, age of products and MTBF.
• Production and Research and Development decisions impact the cost of materials, purchase of new and automation levels. Note, the higher the automation level the longer it takes to complete Research and Development projects.
• Your first product needs to be completed before another one can be started. So if a product is not completed in the first year it goes into the second year and the other product cells will be locked.
• Project Management: 6 Month project cost $500,000,1 Year project cost $1,000,000.
• Unsold units built prior to revision date are reworked free of charge to match the new specs.
• Project completion time increases if the company put two or more products inResearch and Development at the same time.

Capsim Research And Development Recommendations

• Develop a strategy before you start developing any products. Are you going to maintain a presence in every single product segment or focus on low-end products only or focus on high-end only or dominate high-end but still maintain a presence in the other segments and so on. Once you determine what’s your overall strategy then you may start developing and reposition products based on that strategy.

Capsim Tips For Capsim Marketing Module

• Increase Customer Survey Score: Increase accounts receivables to 90 days to improve your customer survey score. Note, TQM also helps increase the customer survey scores but it isn’t available until later on in the game.
• Beware a product with the highest customer survey score will outsell the competitor’s product.
• Increase Awareness: In Capsim awareness is increased by spending the promotional budget which finances advertising and public relations campaigns expenses.
• Increase Accessibility: Accessibility is built over time by utilizing the product’s sales budget. Capsim sales budget finances salespeople and the distribution systems serving customers.
• Pricing Products in Capsim:Don’t priceproducts $5 above or below the price range. Also remember, the price range decreases by $0.50 on the low and upper range every year.
• Achieving 100% accessibility is difficult. In order to achieve 100% accessibility for any product segment, you must have two or more products in that product segment. Once 100% accessibility is reached you can use a combine the sales budget of $3,500,000 to maintain 100% accessibility.
• Note, accessibility is concerned with the product segment and not the product so once a product leaves a product segment then it no longer benefits. Also unless the product segment still has two products that segment will no longer benefit from the combined budget.
• Sales budget are less effective when products are not positioned within the solid circle and when the product’s price and MTBF are not following the product segment guideline.
• New products invented creates a buzz so 25% awareness is given for free. Therefore, inventing products is highly highly recommended.

Capsim Marketing Recommendations

• Use a promotional budget of $3,000,000 annually in the earlier rounds until product awareness is 100%. Then scale back to $1,400,000 annually to maintain 100%.
• Depending on your strategy allow products to drift/age into other product segments to achieve 100% accessibility.
• Follow product pricing and MTBF guidelines for each product segment.
• Use no more than $4,500,000 sales budget for two products in a product segment and use no more than $3,000,000 sales budget for one product in a product segment.

Capsim Tips For Capsim Production Module

• The production module is where the action happens – products are scheduled for manufacturing.
• The production units for each product line needs to be adjusted to your forecasted sales units.

Capsim Production Recommendations

• Allocating Capacity in Capsim: Always ensure there is enough capacity for each product for the next round before ending your current round.
• Capacity must be purchased for every product invented.
• Invest heavily in capacity and automation in the earlier rounds.
• Avoid selling capacity and automation because there’s a loss involved.

Capsim Tips For Capsim Finance Module

• Short term assets like accounts receivables and inventory are funded with current debt offered by banks.
• Investments in capacity and automation are funded by bonds and issuing stock.

Capsim Financial Recommendations

• Issue stock and long term debt in the first three rounds to invest heavily in capacity and automation.
• Retire stocks once you have excess cash, low debt leverage, and excess working capital.

Capsim Tips For Capsim Human Resource Management Module

• Human resource management is one of the modules that’s added later on during the game. For this module ensure you negotiate when you are asked to. Most importantly, don’t be cheap – ensure you try your best to please your workers to avoid strikes.
• Side note, if you invest in automation during the earlier rounds you reduce your dependence on manual labor, which allows you to save money on hiring workers, so plan accordingly.
• Managing recruiting and training is the top priority in this module. The minimum recruiting cost is $1,000 and the maximum $5,000. Never spend more than $5,000 on recruiting because there isn’t any additional benefit. In fact, there is diminishing returns when $5000 is spent on recruiting.In terms of training, 80 hours is highly recommended.
• Spending top dollar on recruiting and training produces a higher productivity index and a lower turnover rate. This, in turn, reduces the need for more workers thereby lowering labor cost per unit.

Capsim Human Resource Management Recommendations

• Hire employees at $5,000 and with 80 hours of training. However, this can be adjusted depending on your level of automation and sales units forecast for the upcoming year.

Capsim Tips For Capsim Total Quality Management Module

• TQM module helps reduce the cost of your business operations, shortens the length of time required to complete R&D projects and increase demand for the products.

Capsim Total Quality Management Recommendations

• Invest $1,500 per category in the first and second round then $1,000 the third round of TQM.