Supply Chain Games - Round II

Below is the recommended strategy in the beginning of the game.

1. Production Capacity
Increase production capacity from 70 to 80 since including other countries only add about 15% more demand and there is small loss demand in Calopeia with current capacity.
2. Priority Level
The priority level should be setup based on the demand of each country: 5 Calopeia, 4 Tyran, 3 Fardo, 2 Entworpe, 1 Sorange.
3. Number of Factory
We should keep one factory in Calopeia. The cost of building another factory cannot be justified with lower demand in other countries.
4. Number of Warehouse
One or more warehouses should be built in other countries to meet the demand there. I suggest we build one warehouse in Tyran (2nd highest demand after Calopeia).
5. Shipping method
We should ship by mail within the same country, but use truck for other countries.
6. Timing
We should store inventories soon enough to meet demand by increasing the order quantity from 1000 to 2000 in Calopeia, and order quantity of 500 in Tyran warehouse. The order point also needs to be adjusted so production can start sending finished goods to warehouses.
7. We should not exclude Fardo from our business since it has potential of generating revenues.

Obviously I underestimated the demand and interpreted the historical data incorrectly. Being risk-averse, not much money was spent for investment. Only one warehouse was built, and no new factories were built. The capacity was only increased to 100 during the game. I was also surprised with the demand of Sorange which I initially thought was the lowest compared to the other countries' demand.

In the course of the game, no major decisions were made to shift our game from the initial strategy. I was being comfortable to see our team's progress. With one factory and two warehouses, the only thing I did was shifting priority levels between warehouses to receive products from one factory. The decision was based on warehouses' inventories. Serving or not serving countries was based on the cyclical demand of each country. I was still hoping that Sorange demand would go down since I was used to seeing curves in demands, but until the end of the game, Sorange demand still keeps going up.

If I were to do it again, I would invest more (at least another factory in Sorange, a warehouse in Sorange, increase capacity more, and do not serve Fardo since it costs too much to deliver products there).

Even though our team was at the bottom, the cash flow seems increasingly stable. Not significant, but stable. The conservative approach did not play well when it comes to competition and high demands from the customers. In this game, I should have paid more attentions to customer demands, I think meeting customer demands is the key to success in this game.