Thursday, December 6, 2012

Back to BASICS

There are THREE important things to know in running your company.
     1) Demo
     2) Profit
     3) Perks

This is a difficult but important concept to grasp. Demo is the larger of GPC and CHC. These are ‘Geographical and Population Coverage’ (GPC) and ‘Customer Handling Capacity’ (CHC)respectively. The way to remember their relationship is this:
     If you don’t have GPC, all the CHC in the world is useless. 
     If you don’t have CHC, you're wasting GPC.

If you’re mathematically inclined, it looks like this:
     If GPC > CHC, Demo = CHC
     If CHC > GPC, Demo = GPC

Demo is very important because, all else being equal, it is the single most important determinant in your profit. The more Demo, the more profit.

GPC is governed by three things: 1) Land Population, 2) Landmark Bonus and 3) Shop Level. Land Population increases as you migrate from District A to District B and from District B to District C and so on. Landmark Bonus comes from landmarks that you build and staff. In summary, the higher the District, and the more the landmarks, the more money you make. Shop Level increases GPC by expanding the area of influence of the specific shop. A Three-Star Shop covers 9 squares. A Five-Star Shop covers 49 squares.

CHC is governed by three things: 1) Shop Floors, 2) Shop Size and 3) Interior Design.

In summary,
     More DEMO, more profit
     More GPC, more DEMO (if enough CHC to cope)
     More CHC, more DEMO (if enough GPC to fill)
          Higher DISTRICT, more GPC
          More LANDMARK, more GPC
          Higher SHOP LEVEL, more GPC
          More SHOP FLOORS, more CHC
          Bigger SHOP, more CHC
          More INTERIOR DESIGN, more CHC

Profit is governed by three things: 1) Shop Type, 2) Pricing Skill and 3) Chancellor Bonus.

Essentially, profit is what’s left over after buying and selling something.
Do not confuse profit with Receivable.

Receivable = what you get paid for selling something.
Profit = what you get paid MINUS what you paid for it first.

     ARPD = what you get paid
     CoGS% = percent of ARPD you pay in the first place.

For example:
     Shop Type: Cafe
     ARPD  = 44
     CoGS% = 61%
     Profit = 44 MINUS 61% x 44
            = 44 MINUS 26.84
            = 17.16

     This means that for each product sold, you Profit 17.16 Cash. You earn 44 Cash, but you paid 26.84 Cash earlier. 

Compare this to a different type of shop:
     Shop Type: Watch
     ARPD  = 58
     CoGS% = 82%
     Profit = 58 MINUS 82% x 58
            = 58 MINUS 47.56
            = 10.44

     This means that for each product sold, you Profit 10.44 Cash. You earn 58 Cash, but you paid 47.56 Cash earlier. 

At the surface level, earning 58 Cash is better than earning 44 Cash. But if you count the actual Profit, earning that 44 Cash is better. Almost two times better.

Perks are governed by a lot of things. The most important thing to know about perks is this: you sell things faster.

     More PERK, FASTER selling

If you can master these three concepts, you’re well on your way to becoming
a successful player in Biz Tycoon HD.



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