In this section, the company you are managing is VitaFruct, which produces and sells freshly squeezed bio fruit juice.
Until now, your company has focused only on the domestic market, but now you would like to expand into other countries.
You will face the following key questions in the simulation:
What kind of organizational development challenges come up during business growth?
What kind of questions must be answered when expanding abroad?
How can the differing exchange rates affect your business?
How can you determine the value of your business? What kind of methodologies can be used to do this?
In this module, your company is VitaFruct, which produces and sells freshly squeezed bio fruit juices.
The company has been running for a while now and is successful on the domestic market. Your target group are healthy young adults with in good physical condition who put special emphasis on the consumption of bio-foods that contain no additives.
So far, your company has focused only on the domestic online sales, but you have determined that VitaFruct is not able to get any more market share. So now you would like to expand into the international market. Your plan is to develop your presence in Poland first.
This expansion will not be easy. Market researchers have indicated that there are serious competitors in other countries who also focus on the bio-food market segment.
But operations in Poland will raise multiple questions. You must plan the cost of entering the market, calculate the local operating costs, create a local price policy, and also find a solution for handling exchange rates.
Your task is to lead your company's management to make the right decisions while expanding abroad.
PREPARING TO SELL THE COMPANY
There are other things to think about along with this market development. One is the possibility of selling the company next year. Some of the owners are seriously searching for an opportunity to sell the business; however, we would like to determine the company's market value, and we also want an action plan to increase the company's value until the sale takes place.
Owners of the company have stated their intention of selling the company, and also set the planned company evaluation methods. As the leader of the company you need to help other managers to prepare for the sale of the company. For this, you need to know the methods of company evaluation and the calculations regarding the valuation. You need to make decisions by focusing on increasing the value of the company. Before making any decisions, you need to ask yourself the question: does this decision increase the value of the company? The goal of the simulation is to receive an investment offer as good as possible (on the merit of good corporate results).
Your job is to manage production, sales and operative tasks month by month, and to help the company management make the right decisions during entering international markets, and to support the management when they are preparing for selling the company.
The company operates for years now, you join the simulation in the 7th month of the current year, when the company's foreign sales office in Poland just starts its operation. Your first task is to set addition marketing budget for this office in Poland.
Main indicators of VitaFruct in the 7th month:
Cash level: 231 037 EUR
Accounts receivable: 1 428 931 EUR
Factory headcount: 83 people
Indirect headcount: 5 people
Production line capacity: 40 000 pieces of product.
Webshop sales in the previous month: 29.000 pieces
Average sales price in the previous month: 35 EUR/piece