Wednesday, February 15, 2017

CAPSTONE: Inventory Estimation

Dear Readers,

This article will focus on inventory estimation in CAPSIM.
I would like to mention that all articles will only lead you to better "estimation" and not the accurate numbers. At the end of the article I have also provided references to other procedures as well.

Parameters required from Capstone Courier:

1. Total Industry Unit Demand                     - TIUD    (Every segment analysis page)
2. Next Years Segment Growth Rate            - SGR      (Every segment analysis page)
3. Potential Market Share % per segment     - PMS     (Page 10 of courier)

Now take the product of all these 3 per segment:
[A] Pessimistic Value = 90% (TIUD x SGR x PMS)
[B] Actual Value = TIUD x SGR x PMS

[A] is what you shall use in Marketing page and [B] is what you shall use in Production page in all rounds of your game. We have achieved 95% accuracy with this formula and only in 2 rounds we were having surplus units / inventory.

Note #1: Based on your competitors product pricing and introduction of new products into the market, you need increase or decrease the estimation anyways.

Note #2: Your gut feel and discretion based on the situation shall be vital for proper inventory numbers.

Sample Calculation:

External References:

[1] CAPSIM Secrets
[2] Baldwin Strategy
[3] General Strategies
[4] Advice to Struggling Teams
[5] CAPSIM Tips
[6] BEST: A Grade CAPSIM Walk-Through
[7] Foundation Analysis
[8] CAPSIM Strategy Blogspot
[9] CAPSIM Word-Press
[10] CAPSIM Success Measures

Best Luck.

1 comment:

Varun said...

Could you share an example with numbers?

If TIUD is 8809; SGR is 9.20% and; PMS is 12.70%