As an IRL manufacturer...


#1

Picked this up to doodle with because, well, as title says, this is sort of what I do. Like a lot of what’s done here, but I want to get straight to what I feel is missing.

(1) Better Financials- Right now they are terrible. Expenses aren’t even being properly categorized - capital investment is NOT an expense. Minimal breakdown at LEAST of COGS, Operational, SG&A, other Fixed, as well as a proper balance sheet. A basic P&L with a fractional breakdown of the line items, based off of total revenues, would be great. Using actual, real world financial categorization and terminology would be GREAT.

(2) Financials, again - Pricing control is just too arbitrary right now. What are my margin dollars for the sedan model I just produced? I want to be able to evaluate market demand against margin dollars, and margin %, to better manage the company. On the Income tab for example you could put individual unit margins as well as net margin dollars for the volume being done. Being able to see demand and margin figures side by side would be awesome.

(3) Production efficiencies- How long are the various units taking to produce? For a single unit, I should be able to know the expected (or even better, an actual average) time to run it through the production line. This information can be combined with demand figures and margin dollars to help evaluate product mix in order to maximize revenues. This would also help me determine which models deserve production line expansion/upgrades in order to make them more profitable.

(4) Product recalls/warranty settings - I’m not sure how defects are currently being punished, but an extra layer of management could be added if they result in product recalls or warranty service and repair. Balancing defect management with cost of service/repair, market perception of brand quality, etc etc.

(5) Prices of components - The graph on this page is worthless right now. It’s basically always flat. There is no marker on the vertical axis to even indicate units… what am I supposed to do with this? Better than this, enable us to analyze the COGS of already designed models vs their anticipated market value.

(6) Labor - Management of labor is completely missing from the game. Management of benefits, reducing employee turnover, recruiting research/sales/operational talent etc etc all could add some much needed dimensionality to the game.

(7) Inventory management/ordering of components - Right now, apparently, components just come flying in through these portals. What ratios? How many of each? Who knows! Although if you zoom out you are treated to a rapidly changing view of what’s coming in (useless). Allow player management of inventory. Manual control of inventory reorder set points, how much to order. Be able to monitor stock levels and actively act accordingly. This applies both to our raw goods inventory as well as finished goods. If we order more, gain of economy on value purchase but lose out partly because we have to dedicate more floor space to storage. Allowing players to fine tune the critical inventory management component of any manufacturing business will really open this game up a lot more. Give guidance perhaps on striving towards JIT inventory management outcomes, and stress players by fluctuating demand through unexpected surges in purchase of finished goods stock.

(8) The sales and marketing aspects - Pretty limited right now. I don’t think you need to do much here, but expanding options on how players can market and perhaps even sell the cars (mfg as dealer? or sell via distribution network?) would be great. Balance the costs and rewards of either externalizing your sales force, or attempting full vertical integration. Could we target marketing efforts towards certain tech we’ve researched? Eg, I want to create and expand the market of electric vehicles. Allow us to focus marketing on the technologies we’ve decided to pursue. Adjust amount of dollars spent on marketing a little more. And print/tv/movie? Come on. Online marketing is a BIG space these days. :slight_smile:

Those are just my initial impressions after playing the game for a few hours. Started with the Small Factory, now producing 20 cars/hr on the original floor space, big range of bells and whistles (although still haven’t unlocked over half the vehicle tech). Haven’t dabbled with the on site manufacturing of components yet either. Look forward to trying that.

But to recap, my biggest frustration so far is the poor quality of the financials and lack of control over inventory management. So much more info that could be delivered to players isn’t being presented that really could make this game so much more fun to geek out with.


#2

Hi thanks for the feedback!
Component prices are pretty flat now, although they do rise with competition, but we eventually plan to introduce world events that will shock up or down the price of various components which is why its in there.

I agree that average time to produce a car (or each model) would be an interesting stat to track and display, its on my list.

The financials is an interesting one. people ask a lot about what their profit per car is, but I find no easy way to make this calculation and have it be 100% accurate without many caveats.
Firstly: COG: I can calculate the cost right now of each component in a car, but i guess the real cost should be at the time those components were ordered? also if those components are manufactured locally then that makes the calculation much more complex.
Secondly: what costs are included in the per-car calculation? R&D? and if so, spread over how many cars? Ditto expansion one-off costs, and capital expenditure/upgrade costs. How do we apportion a fixed cost (like a marketing campaign) over the various cars, do we count it only to each model of car sold during the campaign? or when the campaign is still having a lingering effect?

I think a COG calculation would be interesting, but like I say, when the components got made locally, how easy is it to get a true figure for that? What do real car companies do?

We definitely want to get recalls and reliability in the model eventually.
Labor management, strikes, HR costs and wages are also interesting areas to explore in the game over time.

Regarding 7), are you using stockpiles and mini stockpiles? these are basically what you describe. We haven’t got full JIT, the nearest we have is predictive stock control, where the components get used at the start, rather than the end of fitting, so the next components are then ordered earlier and already on their way.

More marketing options are definitely planned, including online and social marketing, and marketing for a specific purpose (maybe car model or to boost perceived reliability).


#3

Hi Cliffski-

Thanks for the reply! As I dive further into the game progression, very interested in how things begin to play out.

As for costing, I’ll try to explain how (at least in my realm) I would be interested in tracking costs.

First, splitting out your Variable costs versus your Fixed costs is important - especially in a manufacturing scenario! You can reduce the overall impact of your fixed cost on a per vehicle basis by increasing output. So, for example, if your rent is $1000, and you produce 1000 cars, you are paying $1/car for the rent cost. But, if you can increase the efficiency of your factory to, say, 2000 cars, that drops to $0.50/car.

But what wouldn’t change are the variable costs - these are the costs of goods that go directly into car production. Some examples:

Variable Costs

  • Car components
  • Labor for producing cars
  • Power costs for producing cars (ASSUMING these vary with the uptime on the machine - if the cost to run a machine slot does not vary with the number of vehicles moving through it, this would be a Fixed cost)

And some examples of fixed costs:

Fixed Costs

  • Rent
  • Some utility costs (lights, heating, etc)
  • Sales, General, and Administrative
  • R&D
  • Marketing
  • Short life cycle goods and tools (gloves, cleaning materials, etc etc)

Some things that fall into neither of these categories:

  • Loans
  • Infrastructure and long term equipment investment

You ask an excellent question about costing - do you take the cost of the material when it was purchased? or the cost of the material when you sold the finished product? This is usually referred to as FIFO (first in, first out) or LIFO (last in, first out) accounting. Companies take different approaches to this. In my business personally, we track the cost of the materials when purchased - FIFO. But when running overall financials to examine our net costs, we tend to simply average these out over time - say over the quarter.

In the case of a business, you’re constantly tracking on an accural basis how much you spend in a particular category. For example, let’s say I spent $25,000 on a particular component over the quarter. I could simply use that figure to generate a average component cost, and then use that figure to determine what my actual COGs was for finished assemblies that used that part. I tend to do this when examining our overall company performance. But, when I’m planning pricing, I usually use the cost of components at that moment in time. This would be the preferable method for showing cost of production to the player IMO. The historical cost can be examined via the P&L (see below)

As for what costs you want to include in a per-car calculation, you expressly want to leave out any fixed costs. It CAN be useful, at times, to factor your fixed costs in. But generally speaking, you are most frequently interested in only the variable costs of the production - labor, energy, and material that DIRECTLY went into that car. R&D would not be considered a part of the cost (except as in a discussion with your shareholders as to why you spent $5million on R&D and how that benefited the company bottom line, for example). One off costs such as purchasing new machinery - not factored in. Those, in fact, are not even expenses like R&D or sales and marketing costs - those are technically asset investments and are treated differently. Asset investments don’t factor into your profit calculations - we examine those on a balance sheet and cash flows statement.

A Profit & Loss statement can give you a decent overview of the interaction of your variable and fixed costs. Top line, you have your revenues. Next, costs of goods sold (all dollars spent directly on production). You then have a sub total “Gross Profit”. After this, you list your various fixed costs and expenses. R&D, sales and marketing, rents, etc. These are totaled as net expenses, and then subtracted from your Gross Profit to give you your Net Profit. This is a pretty big simplification, but you get the idea.

Businesses usually strive to minimize the % of their fixed expenses as compared to revenues. A low % indicates your management and sales force is being effective. A high % would be indicative of waste.

As for the local manufactured components, it all boils down to the same three things when determining the COGS - how much you spend on direct materials, labor, and energy. Anything that would be spent ANYWAYS, regardless of the number of vehicles rolling through the line, is not counted in the costing for the vehicle.

I have tried using the stockpiles, which allow me to store material in various ratios. This is nice, but I’m not sure that’s giving me control over the quantities being ordered? Or is the behind the scenes ordering system driven by the demands of the stockpiles? Charts detailing inventory levels, lead time on materials (how long after an order is placed does the new material arrive? does this vary from component to component?) would be useful tools for managing stockpiles appropriately.

Thanks again for the reply and I hope I was able to explain better this time how these costs and expenses would normally be accounted and examined in a professional manufacturing context.

Enjoying the game!


#4

One other thought:

It’s not clear how to strategize your research into various features. The “Features” tab on the “Efficiency” window lists the “rarity” of features in each bracket, but I’m not clear if that’s a proxy for demand. Is there variable demand for different features? Eg, given an otherwise equal set of features for a car in a price bracket, would it be more worthwhile investing in Air Conditioning or Bull Bars? If both are “Very Rare”, does that mean they have equal demand levels?

My interpretation is that the rarity enables me to charge a premium on cars with those components, because my competitors don’t have them, but I’m not sure WHICH features I would best benefit investing in, as the demand is completely opaque (if there is even variable demand at all?).

In otherwords, in my mind, there are probably more customers interested in cars with Air Conditioning than Bull Bars, even if both features are “Very Rare”, but I’m not even sure if that’s the case.

Aaaand, one other thought: being able to see the cost of a feature upgrade in comparison to the consumer price it demands would be nice. If A/C costs $900 to install, and I can increase the price by $1000, that’s great. But if Bull Bars cost $200 to install, but enable me to increase the price by $500, that’s even better. Assuming equal demand, of course! :slight_smile: Or are feature costs and the price increase they command intrinsically linked by some fixed ratio?


#5

Thanks for the details.
When it comes to demand for features, you are correct in assuming that you get more of a premium depending on the rarity of the feature. My best example here would be teslas ‘autpilot’, they can charge a premium because its very rare on cars, regardless of price range, whereas the premium on electric windows these days is likely close to zero.
Right now, wwe do not have variable demand on a feature-by-feature basis. The way it works is as follows:

Customers come in with a set budget range and only consider cars within that range. They are entirely flexible as to which features they get for their money, but will pay a high or low premium for those features based entirely on how rare they are. The probability of a customer buying the car is derived from how good value it seems in terms of its price versus the ‘fair price’ that it would normally sell for, given the value of its features.

I may make that more complex in future and have varying demand for body styles and features over time.