1. Positive cash flow

Like SimCity, you need to establish positive cash flow as quickly as possible. There are no delinquencies and no asset-backed loans (which is bad). Once you run out of cash, you have to go out of business. The criterion for bankruptcy is not insolvency, but your inability to pay your debts on time. This has been a Western business tradition since the 15th century. In China, because business culture and contract concepts are relatively weak, and the government is worried about the unemployment pressure caused by the collapse of state-owned enterprises, the bankruptcy law is very restrictive. The private sector is also affected by the traditional weak concept of contract. Private business owners often invest the money they have, without being able to distinguish the difference between cash and profit. They wait until debt collectors come to find a solution. Anyway, their assets are there. It’s not like you haven’t paid yet, so what are you afraid of? If you want to collect the debt, just wait for two days.

2. Brand policy

Determine your brand policy at the beginning, because changing the brand policy will cause the previous brand to be scrapped. This setting is not very reasonable. When Lucent was first established, it borrowed the name AtT for a while. After China Telecom changed its logo after the split, you can say that its users will start to know China Telecom again, thinking that it is a company with high fees and low services. Does it no longer exist? The negative brand loyalty caused by the initial phone installation fee cannot disappear so quickly.

You can choose three brand policies, unified brand, series brand, and individual brand. The unified brand can be strengthened through the expenses of the public relations department. Advertising expenses are relatively small, and there will already be some brand foundation when developing new markets in other cities, so there is no need to start from scratch. But if the quality of your products is unbalanced, it will give people a bad impression. Low-quality products will drag down your high-quality products, but companies like GE and Mitsubishi that do everything from chips to ships are not the same. No. Individual brands mean that each product uses one brand and will not affect each other. However, advertising expenses are a problem. However, the advantage is that the brand value increases very quickly, much faster than when using series brands and unified brands. Series branding is the use of one brand within the same series, which can limit the impact of poorer quality products to a certain series. Moreover, products in the same series use similar raw materials and generally benefit from the same technology development. Once a certain technology is improved, the quality of products in the same series is often improved together. For example, the improvement of chip technology leads to the improvement of chip quality, and the improvement of chip quality leads to the improvement of the quality of three products in the computer series: desktops, notebooks, and handheld computers (the fourth product is a printer, which does not use chips).

OEM is allowed in the game, which is a very interesting setting, but this function is not clearly stated in the game. You can see a trademark department in retail stores and factories, but in the management guidance menu you only see the sentence "Products handled by this department". How to deal with it? There is no explanation of what this department does. Now let me tell you, this department is branded. Buy consumer goods from the port or NPC factory, process them through this department, and then sell them to become your products. When you view the product details, it becomes the product you produced. The corresponding price is that you cannot use the original brand, and your brand starts from scratch and is far inferior to the supplier's brand. There is also a trademark department in the factory, but I don’t know what it is used for. Because the factory's purchases are intermediate products, and intermediate products only have price, quality and no brand (of course there are brands in the real world, this is a reasonable simplification). Therefore, this trademark department is used to label self-produced products. Why do you need to put a trademark? Can you strengthen your own brand? I can't find the answer.

3. Research and development

As mentioned earlier, the retail industry has no competitive advantages and core competitiveness. Of course, it is not impossible to become a retail brand giant like Wal-Mart. We will mention this in the strategy section later. Here, competitive advantage and core competitiveness come from three basic factors: price, quality, and brand. We have already mentioned how to reduce costs through freight and production capacity, and also talked about some basic concepts of brand management. Now let’s talk about quality. Between different products, the influence of price and brand waxes and wanes, but the influence of quality is eternal.

R&D is the improvement of production technology, and the improvement of production technology is the improvement of product quality.

When our research and development improves chip manufacturing technology from 30 to 100, our chip quality is 95+2.5=97.5, an increase of 66.5.

You can also buy technology from others, because you often don’t have the money to support too many R&D centers at the beginning. Companies with leading technologies are generally unwilling to sell technology, but the chance of successfully buying from them is still about 20-30%. You can buy 100% of the technology from the company ranked second in technology.

4. Pricing

The improvement of technology leads to the increase of quality, and the expenditure of advertising leads to the strengthening of the brand. The result of the combination of the two is that the overall evaluation of your product is far ahead of the competition. those. Such a high evaluation is of no use to you. You only need to have an overall evaluation slightly higher than that of your competitors. The rest is your room for price increase. Investment in brand and technology is not only rewarded by the increase in sales volume. When the overall evaluation index drops to slightly higher than that of competitors, the maximum price increase that can be obtained is to evaluate your technology and brand. A more intuitive way to understand the return on investment.

NPC’s company adjusts its prices very frequently. When the quality is higher than mine, it will be raised to more than twice as much as mine. When the quality is too poor, it will be less than half of mine. At this time, I simply don’t know. The price has not been raised, which shows that his sales must be at a loss. Adjusting prices is just like adjusting rents, it is a very troublesome matter. To adjust rents, you must always pay attention to the occupancy rate, and to adjust prices, you must always pay attention to competitors' prices. Unless it's an exclusive monopoly business and I raise the price all at once, I usually leave this troublesome task to the hired COO. There is an option in the COO's panel that is price policy. If you choose aggressive, then he will adjust the price as high as possible to squeeze out every penny of profit. However, several COOs I hired did not do well, probably because their retail capabilities were too poor.

5. Hire people

After you establish the headquarters and establish the corresponding office, you can hire three people, the sales director, CTO, and COO. The salary standard depends on your annual sales and fluctuates slightly according to individual abilities. The COO's salary can account for 1/5 of the annual profit. When your annual profits increase they will ask for a raise because you don't know how much is appropriate, and refusing will cause the relationship to sour and make it impossible to hire you again. So I usually add a little more, and then after the other person rejects it, I go to the character information to hire him.

The sales director is used to strengthen the sales of your retail store. For some reason, the selection criterion is operational ability. The sales director has a great influence on improving sales levels, and I have no way of knowing the algorithm. However, one time my sales director asked me for a salary increase. After the salary increase, my monthly profits doubled. However, the year before and the year after that, I made mergers and acquisitions in the stock market and did not do anything in production and operation.

The CTO can strengthen your R&D and decide new R&D plans on his own to prevent R&D resources from being idle and wasted. Of course, you can make adjustments to his plan. The problem with the CTO is that he will continue to develop more than 100 technologies. In fact, there are nearly a hundred technologies waiting to be developed in the entire economic system. You can buy technology from others through the CTO's office, or you can buy technology through your own (CEO) office. I don't know what the difference is between the two. When buying technology, if the technology is lower than 80, the other party will generally be willing to sell it. If the technology is higher than 80, you can only buy from the company that ranks second in that technology. Companies in the leading position are generally unwilling to sell technology to others. When I buy technology, if this technology is what I am applying in production, I will not sell it.

The salary of the COO is several times higher than that of the other two people. Different positions for the same person will have different salary requirements. COO is an automated management assistant, and its level of automated management is related to the person's level of a certain ability. The suggestion in the introductory course of the game is that manufacturing, mining, and planting are better. In fact, there is no choice. In many levels, all ability indexes of all people are 0. I mainly expected the COO to help me automatically adjust retail prices, but in fact he didn't do a good job. In addition, when the retail industry purchases from the manufacturing industry, when the same product is produced by several factories, an imbalance often occurs. One factory is in short supply, while another factory has excess production capacity. Because the sales fluctuations of each retail store are relatively independent, and the purchase of retail stores is locked to a certain supplier and cannot be adjusted.

When manufacturers are temporarily unable to supply goods, retail stores will not temporarily switch to manufacturers with excess production capacity, because automatic switching will only occur when manufacturers completely cut off sales. I originally expected the COO to help me make this adjustment, but in fact this function is not included in the AI.

Another way to solve the problem of uneven sales of different factories for the same product is to set up a warehousing center. Because Financial Empire 2 does not provide the construction of a warehousing center, we can only use a small factory to purchase from multiple manufacturers and sell them together in a "purchase-warehousing-sales" method. Although you have to pay a maintenance fee for a small factory, it is much more convenient in terms of management, and after the problem of uneven sales is solved, the market potential will be more fully tapped. But this only applies to uneven sales of intermediate products, because factories cannot buy final consumer goods from factories, and stores cannot buy final consumer goods from stores. After the final consumer goods come out of the factory, they can only go directly to the point of sale for consumers without adding an intermediate link. This is also a design flaw.

6. Factory location selection

For the production of high value-added consumer goods, the purchase decision of intermediate products is a headache. If it is possible to outsource, it is recommended to temporarily outsource it while strengthening research and development, and then produce it yourself after the research and development is completed, because self-production means a large investment from the mine to the factory of intermediate products. When there is no way to purchase outsourcing, you can look for it in other cities. Although the intercity freight is a large number compared to the original price, and sometimes the freight is even higher than the original price, but for high value-added manufacturing industries, The cost of raw materials is only a small number. When you temporarily have no money to produce on your own, it is more cost-effective to pay freight than invest money.

Sometimes the required intermediate products are supplied at the ports of other cities. Because you cannot directly buy products from other cities’ ports, you can build a small factory locally and resell them after purchasing goods from the port. to your final consumer goods manufacturing facility.

Sometimes you build your own intermediate product manufacturing factory, but local downstream companies cannot absorb its production capacity, and you plan to develop new markets in other cities. Will the new final consumer goods factory be built next to the new market, or in the city where the intermediate products are located? If the new factory is built next to the new market, should the intermediate products be purchased locally, or should they be produced in-house at the cost of intercity freight? Self-sale?

Outsourcing or in-house purchasing of intermediate products? The answer is very simple. If you have a factory producing, purchase in-house as much as possible. Because your cost is not as high as it seems, a large part of your purchase price is the profit of another factory. However, when selecting a new factory location, freight costs must be considered.

Financial Empire 2 has two bugs in the intercity freight algorithm. The distance between Taipei and Seoul is only 24 kilometers, but there are hundreds of kilometers from east to west of Taipei City. The distance between cities is much smaller than the actual distance, and even smaller than the distance within the same city. This is incredible. Another BUG is that the freight for the car body and engine is much higher than the freight for the complete vehicle.

In addition, shipping costs are calculated based on the value of the product itself, not based on volume and weight. The result is that the freight for raw materials is so low that the freight for shipping one engine can transport enough steel to build hundreds of engines. Our response to this situation is to place high value-added production in the local market, while intermediate products other than raw materials and car bodies and engines can be produced uniformly in a certain city.

6. Market research

The game directly provides market research data. You can directly check the market share and comparison of various sales factors from the product details. In reality, this kind of data is not so easy to obtain. You either have to spend a lot of money to conduct the survey yourself, or you can buy it from companies like AC Nielsen. Even for big-name companies like AC Nielsen, the market data obtained may still deviate greatly from the true situation of the market.

So, take advantage of this free resource and check product details frequently.