Hey I'm Mathew Georghiou the lead designer of this business simulation game let's play!
I'm going to start a new game here.
Before I was able to get to this comprehensive business simulation I actually had to do some training on some simpler businesses, and so once I complete that training then I was able to enter this big city with this very realistic simulation. In fact, the simulation we're going to play right now is the most realistic startup and operation simulation in the world. Alright, so welcome to Big City, this is where we'll start and run our full businesses. This is the tutorial that's going to walk us through here with a full business. We have many products to sell, multiple inventory items to manage, several employees to supervise and many challenges to overcome. This is not going to be easy, use your past business experience to set you up for success with this new business. So that's again referring to the training that I've already done, take note of the clock. You have to properly manage your time because the clock will keep running while you're working.
You can change the speed of the clock by clicking the clock or the slider under the time. So this is the clock that it's referring to. Everything runs by the clock so you're actually managing your business minute by minute, hour by hour. The clock only stops when you go home or pause the ggame. You can choose when to go home each day by clicking the home icon. There we are.
When you're home you'll choose how much time to allocate to personal, family, and sleep. Home time improves your health. Alright, so there's our health meter right here and it looks like it's at 80% to start with, so it seems the more we work or if we work too many hours our health will go down. I mean, if we take time away from work our health will go up. The clock is stopped right now to give you time to make your startup decisions, okay so we've got plenty of time to think things through. Start on the company screen. Okay, so there's our menu at the bottom. We're at the company screen making your first startup decisions, so the menu is not clickable right now because I'm in the tutorial. Alright lets go ahead and do that, okay so we have to choose our business type and we're going to run a restaurant in this particular example here. There are other business types to choose from and we can review our founder and CEO. So there I am, and there's my health level and there's my seed financing. So it looks like I started with $60000 but my startup services were $15000 of that so that's going to use up a fair bit of the $60000 that we started with, and we're a little limited liability corporation. We own 100% of the shares, and we'll actually be able to sell shares later on if we like. Alright, lets choose a name and a logo for the business. So I'm going to call this Foodies. Name my business and we can choose a logo for it, this looks interesting, lets choose that one, and now we have to choose a location. Alright, so I can see there's three locations just the shopping district, the park, and main street. So the park I'm guessing would be, good for people taking time off/away from work, and just want to enjoy some time in the park. Probably not so good if the weather is not good.
So I can see the actual weather in the forecast here, so on good days the park will probably be crowded and on bad weather days probably not so much. Main street seems to be kind of the downtown core, and that's probably where people are looking for a quick lunch or something like that. And the shopping center is like a mall so I can actually review consumer profiles here, so I can see what they want so I'm thinking about main street and I can see that Main Street they want quick service and a little bit of business reputation and a balance of price and quality. Okay, so that's kind of the main things I want to look at there and the weather has every little effect on traffic because, you know, people have to go to work regardless of the weather and I can see customer traffic so main street you can see, weekdays are pretty evenly distributed so that's where most of the traffic is. Not so much on the weekends, though there is some. The shopping center probably has traffic on the weekends and same with the park. Okay, let's scroll down further and these are the customer traffic by hour and I can see main street is red around lunchtime so that's our peak traffic, when a group of customers comes and then an early dinner and supper. Okay, so that's going to help me with my setup, so let me go ahead and choose Main Street. Say okay, alright cool so well done next you have to make operations decisions. Click the operations button below.
Choose a site for your business, okay so this is the kind of building that we're going to be in so we can choose economy, quality, or premium. Rent $1500 per month, and this is $2500 and this is $4000. The leaseholds are $3000 so leaseholds are what we have to pay right up front to kind of renovate the space to suit our needs, so the best thing here is to actually start with the economy because it's the least expensive and then as our capacity to serve more customers increases than we should upgrade to the larger facilities. And you can see there's the actual capacity so this one only has a little bit more than 25, more than a quarter of the capacity of the premium so when we start getting a lot of customers that's when I'll have to level up but for now we have to preserve our cash because you know we're going to have a certain amount of startup cash. So I'm going to choose economy, so lets do that. Well done now click equipment belong in the submenu.
We've got to choose equipment, okay so this is our restaurant equipment so we've got starter, starter deluxe, deluxe deluxe prime, and prime. So the difference here is that this is used and this is new, and also the capacities. So I can see the capacity, and that's how many customers I can server around the same time, and that increases based on the cost and size of the equipment. I'm going to start with the lowest cost and then move up, so I've got the choice between $5000 or $10000 new, so you know I'm gonna choose this one. Now we can actually sell that equipment but I think we're only going to get a certain percentage if we sell it, it's like 30% of what we originally paid but you know, if you're growing you've got to do that anyway. So let's go ahead and choose starter new. Now click schedule in the submenu. Alright so your business is not yet scheduled to open for customers, this allows you time to prepare your business, such as ordering and receiving inventory, hiring employees, and other activities. Once you're ready to serve customers, return to the screen to set your operating hours. We cannot set them at the moment. Let's continue.
Alright so your business is not yet scheduled to open for customers, this allows you time to prepare your business, such as ordering and receiving inventory, hiring employees, and other activities. Once you're ready to serve customers, return to the screen to set your operating hours. We cannot set them right now, okay so this is where we would set our operating hours. Let's continue. Click documents in the submenu below. New businesses must register with the government, qualify for permits and pay for a variety of business services. Everything your business needs has already been set up for you, and you can review the costs on this document screen. So I can see that there's business registration and tax. A lot of these are one-time costs and some of there are recurring and if you remember we had $15000 startup, so a lot of that $15000 is used by these services that we had to incur and we haven't paid for them yet, they're invoiced. We're going to have to pay them in a minute. Alright, click the finance button below. These are your payables, here they are. Any bills or money you owe are here. You must frequently return to this screen and click the amount you want to pay on each payable. You must do this otherwise you'll risk going bankrupt. I also happen to know that the benefit of paying bills quickly is it'll help out our business reputation, so if you pay people quickly they'll like doing business with you so it'll help build up goodwill with our vendors. Alright, the new startup business is launched and the clock is moving. I'm going to slow the clock down a little so that we have more time to think. It's beneficial for us to speed up and slow down the clock because the more days we can get to our business, the more chance we have of making a profit. In growing our business we want to move quickly, but not so quickly that we're unable to make decisions. If I'm trying to make decisions and customers keep coming and I'm trying to serve them, this will be difficult. There's no pressure because we're not scheduled to open for business, so let's do a couple things. Let's take a look at those documents we looked at before. For example, insurance and so this is going to cover most of our cost so we can see what insurance is and how much it costs. We can look at business registration, so I see there's a $1500 startup fee and we're going to be charged a yearly fee of $250 as well. So we can review these things here. Let's go to our finance and here's all the bills we owe. Let's go ahead and actually pay those bills because I don't like owing money for a very long period of time, especially if I have the money to pay somebody. I'd rather just pay them off. So let's go ahead and do that, and now we don't owe anyone any money. Although look at our cash, we went from $60000 to $40000 to $24000 and that's because not only do we have the startup but we also the site with our rent and the equipment that we had to buy and the leaseholds that we had to pay for. Alright, so it costs money to run a business like this, so let's go to our products and see what we're selling.
Okay, so it's a restaurant. I can see I've got a hamburger, and I can click on it to see hamburger, french fries, chicken strips, salad, chicken wrap, vegetable wrap, cola, juice, coffee, water, pie for dessert, oh we have bacon and eggs...that's good. We also have ice cream sundae. Okay, so we got everything here, great. I can see there's no quality yet because we don't have any inventory, and there's the price. So there's a default price, but I can chance the pirce. Like, let's say on our hamburger instead of $4 you know would can make it a bit more, for $4.20. I probably shouldn't be tweaking the price right yet until I get some feedback from my customers or see how much this stuff costs. So most of this is empty because I haven't got any sales. Let's go to inventory, alright so this is where I have to buy the ingredients that make everything. I can see there's hamburget meat, so if I go back to products and look at hamburger I see it's a flame broiled hambuger in a bun. That's cool.
Let's go back to inventory for a second, and there's some tabs up here and I can see usages. So it shows me how each inventory item is used so I can see a hamburger meat, I need one serving of hamburger meat for a hamburger. All right.
And buns. That's used in a hamburger as well. So I need buns, and you know some other things but anyway I'm going to buy everything because I want to sell everything. So let's go back to our inventory, and look at aging. Actually, our inventory...aging, yup. That's the right one, and now we're going to go to our supplies. Okay, so we have different supplies to choose from and I can see these are suppliers, these guys say our food may be frozen but so are our low prices. Okay, so they look like they're positioning themselves as the lowest cost provider, but frozen food quality is not as good. Let's look at Top Meats, if I want to have really great burgers and chicken I would get them here. If I go to a top bakery I can get top quality bread. Premium beverages, okay so it looks like I can buy drinks at a good price from these guys but it says just beverages so that means they only sell beverages. And then there's Farmroy, locally sourced organic foods. Okay, that sounds expensive but delicious and what a whole bunch of customers want these days. Right, so we have some decisions to make! These are our shipping options, so we've got to worry about shipping so who has the fastest shipping because I want to get started selling right away. Okay, so I've got one here and it looks like the fastest I'm going to get. It's frozen food, so I might not want to stay but just for the sake of getting some sales as soon as possible I'm going to go with them. So let's go ahead and order inventory. I'm going to choose prices as the supplier and this shows me everything that they have available for sale and this looks like they sell everything, which is good. Let me just check the other suppliers. This one only has meat and bread, so I wouldn't be able to get other stuff from this supplier, just my meats and bread and get the rest from other suppliers. So I'm gonna have to experiment to see who's gonna give me the kind of best price and best quality, and actually look at the quality of this guy's ingredients. Now let's go to prices...look the quality is half as good so that's not going to be as great for my customers, a buck for hamburger meat what this other supplier? Oh, it's two bucks so it's twice as expensive but the quality is better. So if I go with these guys later I'm probably gonna have to raise my prices but my customers want better quality so they're probably willing to pay a little more for it. Let's just get some inventory and start making some sales. Alright, so I'm going to click on this one instead of just clicking how many I want, I'm going to use this quantity dropdown here which will allow me to quickly get a bunch and I get discounts the higher quantity I buy. Which is good to keep in mind as we figure out our best patterns for ordering inventory. So lots of experimenting! We're going to have to figure out how, you know, how much inventory we're selling, you know what's our top sellers, how much we have to buy, etc. You know if people are liking our products and our quality and so on. Alright, we've got 100 in everything, let's go ahead and select expedited shipping so we can get it in one day plus one day delivery so it's still going to take a couple of days. It's going to cost $170 just for delivery, wow. That's because we want it fast
So you've got to pay for it, alright so inventory ordered so now e have to wait for it to come. That's okay, we've got other things we can do. So we can review the order here. Here's the order that we just placed and we can look at it, and I can see duplicate the order so that'll make it easy if I want to keep ordering the same order every time, so I don't have to click all those times. Alright so that's cool let's close that all right so that's all of our products area, let's take a look at employees. Okay, so we've got me, the founder and CEO and I'm working in the business by not taking a salary. To keep living costs low you're living a frugal lifestyle and paying your costs with personal savings, keep this in mind when reviewing the profits in cash flow for your business because they would impacted if you were taking a salary. So basically what this is telling us is that we're not getting paid as owners and operators of the business however if we generate profit in the business then that profit could be our pay so the more profit we generate the more salary we can pull out of the business. Okay job applicants. Alright, so these are all the employees we can hire but you know what I'm not gonna hire any employees yet, I'm gonna skip over this for now, let's just try to make some sales. I'm not gonna do any marketing either because I have to make good decisions and I don't want to waste my money until I know that I'm getting some customers and making some money. So let's go ahead and try to get some sales as quickly as possible. Now, I'm just doing this so we can make those sales fast. I wouldn't normally do this if I was trying to do really well here, but alright so you notice the clock as been ticking all this time so it's 5pm, let's' go home. So we're going to click on the home icon here, and there's 30 minutes of commute time so it takes 30 minutes for us to go home and 30 minutes to come back. It's midnight now and this is the end of day report now, there's no numbers here but we'll look at this later when we have some sales.
So you've got to pay for it, alright so inventory ordered so now e have to wait for it to come. That's okay, we've got other things we can do. So we can review the order here. Here's the order that we just placed and we can look at it, and I can see duplicate the order so that'll make it easy if I want to keep ordering the same order every time, so I don't have to click all those times. Alright so that's cool let's close that all right so that's all of our products area, let's take a look at employees. Okay, so we've got me, the founder and CEO and I'm working in the business by not taking a salary. To keep living costs low you're living a frugal lifestyle and paying your costs with personal savings, keep this in mind when reviewing the profits in cash flow for your business because they would impacted if you were taking a salary. So basically what this is telling us is that we're not getting paid as owners and operators of the business however if we generate profit in the business then that profit could be our pay so the more profit we generate the more salary we can pull out of the business. Okay job applicants. Alright, so these are all the employees we can hire but you know what I'm not gonna hire any employees yet, I'm gonna skip over this for now, let's just try to make some sales. I'm not gonna do any marketing either because I have to make good decisions and I don't want to waste my money until I know that I'm getting some customers and making some money. So let's go ahead and try to get some sales as quickly as possible. Now, I'm just doing this so we can make those sales fast. I wouldn't normally do this if I was trying to do really well here, but alright so you notice the clock as been ticking all this time so it's 5pm, let's' go home. So we're going to click on the home icon here, and there's 30 minutes of commute time so it takes 30 minutes for us to go home and 30 minutes to come back. It's midnight now and this is the end of day report now, there's no numbers here but we'll look at this later when we have some sales. Let's move the clock up faster so we can get to 11 o'clock and open for business and get some excitement happening here. Alright, here we go! We're open for business! The customers are represented by these little dots, and you can hear either a ding for a sale or a blrrp for a missed sale. You can see the little x's as well for missed sales. We'll have to figure this out. You can see the happy and sad faces, that's the customer feedback. If our customers are happy or not then these icons appear. If an icon appears on the left side of the face that means something negative is happening, and if it's on the right side, it's positive. We're losing a lot of sales but that's okay, because this is our first day in business, we'll figure things out as we go along. This is all part of the experience! Running into problems and failing on certain things helps us learn and continue to improve. Now we're going to look and see what's going on here, oh we ran out of oil seasonings and condiments which are used in pretty well everything we make and that's our killer here. Alright, so lesson learned we would have made a lot more sales for the day if we had more of that item. Alright, we're ready to close the business. Alright, there go it it's closed. Let me slow down the clock to give us a bit more time to figure things out. We've served 92...or, I think we've sold 92 products and lost on our 114. Our revenue for the day is $280 so not a great day now, what I should do is actually go to my products and immediately order inventory and again, I'm going to go with the expedited shipping to try and increase this quantity. I'm gonna do 500 this time, and everything else looks like it's still okay. A lot of things I didn't sell mostly because I couldn't cook them because I ran out of this important ingredient. I won't order more meats and stuff because their qualities will degrade over time. Let's place the order, alright, it's good. It's getting late so I'm going to go home soon, I don't want to get impacted with negative health here but before we do that let's go ahead and look at our reports, and we can look at customer feedback. So this will show us what kind of feedback we're going to get from customers, not it only shows us up until the day before so we have to wait for this day to be over before we see the results. Let's go home and get started early on the next day, let's say you want to get to work around 7:30am the next day, okay so there's our end of day. We served 36 customers, which was much lower than I was hoping for. We lost 114 customers while I sold 92 products and sales revenue 280 Cost of Goods so that's all the ingredients that we used to make our products. $120 is our gross profit, and our profit margin is 57. Now I happen to know in the restaurant business a gross profit margin should probably be around 60, 70, maybe even as high as 75%. That's essentially your food and preparation costs. Of course, you know gross profit margins don't tell you everything, there's a whole bunch of other costs that we have to deal with, like our rent for example, and our utilities. and so on that are not reflected in gross profit they're actually reflected in another number called net profit. I can also see some of my inventory items were discarded or spoiled so I lost $1.30 of value. SO I have to be careful not to have too much inventory on hand that's not going to sell, otherwise I could lose out there Alright, let's commute back to work. So we're at work the next day and I don't think I want to open today because remember? I ran out of inventory and so the same thing would happen to me here so I'm actually gonna close today, and change my opening tomorrow to 11am, in case I get my inventory. There, I've made plans for the next two days and I think i'm going to get my inventory tomorrow, but we'll have to see. Let's go ahead and look at a report. Remember we're going to look at our feedback, so there we go we can see now that on Day 3 we lost six customers because of service, so that means my service was slow which means that I was the only one working and couldn't serve as many customers as they came in, so that's shows I might have employees. Now I'm not ready to do that yet because we lost a lot of customers here because of our inventory so I want to see what my numbers are like when I have enough inventory to server everybody. I don't want to start making decisions on five different variables at the same time, so we kind of want to isolate the variables. I can see one person we lost was unhappy, we didn't necessarily lose them but they were unhappy because of price and a whole bunch of people weren't happy with the quality.
Remember we bought all the frozen food? So the quality is not as good, and so a lot of people are not so happy with quality now. I could probably improve that if I lower my prices because people are willing to forgive you on quality if you charge them a low price, so they feel like look I'm not paying much so I kind of get what I pay for. I think we can be forgiven if we lower our prices a little bit, or the other option is to increase our quality and buy better inventory. We did lose everyone because of our inventory, as you can see here, along with our capacity too. We actually lost some people one of three reasons: our equipment, our site capacity, or the inventory. We have no positive feedback but don't worry about that, we might get some the next day we're open. So here's our customers served and lost so we can see a little bit more details about why we lost customers. Our customer satisfaction wasn't too bad at 71%, so it's not completely terrible. Let's go ahead and close and advance to the next day and speed up a clock a little bit.
Hopefully our inventory will arrive and then we can actually open for business. Here's the end of day, I'm gonna skip through that very quick and we're back on our way to work, commuting with that 30 minute commute as a killer here, using up good sales and work time that we may need. Alright, let's speed up the clock to get the show on the road so we can get our inventory to arrive and we can start making money. And here we go, inventory has arrived and listen to all those dings, and not many bloops.
We're not losing many customers at all and everyone looks reasonably happy, but they're not happy with our quality. Oh, look we're running out of something again, what did we run out of here? Oh, ran out of potatoes. Gotta pay attention to m inventory.
Well, we'll let that go and take a look at our employees because I think at some point we're going to be losing people due to service. Let's look at our employees here, so what we can do is review different employees...and oh, there's our end of day.
We served 68 customers and did a lot better than our last open day, still lost a lot but we made a lot more money today. Gross profit margin still on the lower side, but you know, much better than the day before so we're definitely improving. Let's go ahead and slow down that clock because it's already past midnight and we're out of potatoes as well. Let's see what we're going to do here. So we can look at different employees and we look at the work experience and education, so I can get on employ. So let's go ahead and find someone affordable here. Food service skills aren't great, customer skills aren't too good either but she's only asking for $12 an hour and others are a lot more expensive but let's try Maria here. Okay, Maria is looking good, customer service is high and she has some food service experience but not too much but $14 let's go ahead and offer her that for a job. Offered accept, good news. Alright we have an employee now so what we can do is schedule Maria in our schedule here and looking at employees by week we can look at Maria for example so this shows us our operating hours so what's today? Saturday? So let's say I wanted to work tomorrow, Sunday, I could add her to work at specific hours in the day or maybe the entire shift for the day and then on Monday I can do the same thing. Have her work just the rush hour lunch time because that's when I think I might need the most help, in fact, you know let's reduce our hours here until we figure out how to do better and how to make money here before we actually spend too much money, so that's how we can do employees and we have the option of including benefits as part of the compensation package. So we can do health insurance and so on, and they're a percentage of salaries so if I turn it on for my employees then all employees will get these benefits but they aren't cheap to offer. They're kind of expensive but it might keep morale up and keep their productivity up and increase their loyalty to the business so it's probably a good idea to invest in some of these things as you start generating a little bit of money. We can actually invest in those things and eventually we can train our employees, review HR reports to see if employees are showing up for work and so on, and then we can start marketing. So once we figure out how to make money, the next step would be to start marketing our business. We can look at it here and see our business reputation, and it's made up of four different metrics like: customer satisfaction, employee morale, and so on and then our advertising effectiveness. We don't have any yet because we haven't actually started advertising. So we can invest in things like signage and appearance and customer service, and product quality and we can put on a sale and see if that attracts more customers. WE can invest in actual advertising options here, but to do that we have to review our various customer psychographics, different consumers segments and decide who we're going ot target because we can't target everybody. For example, I can see here that if I want to target people who are time sensitive which re recognize that we're in the main streets so many people are time sensitive so I'm going to target them and then maybe one and two because they're the biggest green bars, again more time sensitive so I want to target six. One and two, so when I go to targeting I would identify the consumer groups I want to target, so six, one, and two so I might put you know, 30% of my focus on them and 30% on them and then maybe 40% on on them so now I'm 100% and I can experiment later and come back and see how well my targeting is working. I'll do the same with messaging so here I can use keywords, depending on the type of restaurant I want to run, it's like do I want to run a quick service like low cost restaurant, fast food quick service and low prices. I think those are the kind of affordable value meals, and those are the kind of keywords that would attract my consumers. I can see things like gourmet is not going to resonate well with my target audience so this is the kind interesting. We have to really think about the keywords we can target, we can choose up to eight of them for each consumer group and then come back and experiment to see how well each one is doing and then different media options as well. So I can see which type of media, whether it's TV or social media or events or sponsorships are the best way to reach my particular customers. And again, I can allocate a percentage of my budget to these areas and then come back and see how well it's working and then adjust it so every few days I can come back here, adjust it, and see if I can improve my targeting and so on. Lots going on in the simulation.
Let's go ahead and close that, I can also see under the menu that I can control various things like the music and sound effects and so on, and if I go back to reports I can bring up balance sheets so I can understand the value that I'm building my business. I can bring up income statements as well.
And I can see where a lot of my money is going, and all sorts of other reports in terms of products that I'm selling and the finance. I can apply for loans or sell shares in my business. I can see I've got some bills to pay as well, and then the last thing here was this is our performance report. This will actually assess our behaviour in terms of our performance in the simulation, so it's actually going to give me a skill score. We're not doing very well right now, it's a 32 but we're just getting started and we have to build up our success as we go and it's going ot rate us on finance, leadership, sales and marketing, operations, and how we treat our employees. We even have micro learning build in as well, which is kind of cool. So we can learn a variety of things in microleaning. If we want to learn about certain topics, whether it's about learning about marketing, finance, or accounting we can actually watch videos and do quizzes and so on. We can refine our knowledge and then apply what we're learning in this microlearning to real life. Alright, so that's us playing the simulation. We could play for hours on hours on hours and we can try different business types as well which would be kind of cool and just keep improving our business and keep learning. This is a very realistic business simulation. Hope you enjoyed this walkthrough.