Business Simulation Lab
Executive Decision-Making & Financial Strategy
Run the business.
Manage the consequences.
You are now the executive management team of Vertex Consumer Products Ltd. Over four quarters, you will face changing market conditions, financing pressures and strategic opportunities. Your decisions will affect revenue, profitability, liquidity, leverage, working capital and shareholder value.
Vertex Consumer Products Ltd.
A fictional mid-sized consumer products company with an established customer base, moderate debt and an opportunity for expansion.
Market Intelligence
Q1 BriefingConsumer demand is strengthening. Management has an opportunity to increase market presence, but aggressive growth may require additional working capital.
Executive Decision Center
Decision RequiredHow will you respond to rising demand?
Demand is expected to increase by approximately 12%. Management must decide how aggressively to pursue the opportunity.
Competitor prices fall by 8%
A major competitor has reduced its selling price. Management must decide whether to defend market share or protect the company’s margin.
Cash flow is tightening
Customer payment times have increased and working capital is under pressure. A bank has offered additional financing at 9% interest.
A major expansion opportunity appears
Vertex can invest in a new product line. The opportunity could materially increase future revenue, but management must consider the company’s existing profitability and financial risk.
Board Performance Review
You have completed the four-quarter management challenge.
Financial Intelligence
Live| Revenue | $0 |
| Cost of Sales | $0 |
| Gross Profit | $0 |
| Marketing & Operating Costs | $0 |
| Interest Expense | $0 |
| Tax | $0 |
| Net Profit | $0 |
| Assets | Amount |
|---|---|
| Cash | $180,000 |
| Accounts Receivable | $100,000 |
| Inventory | $120,000 |
| Property & Equipment | $250,000 |
| Total Assets | $650,000 |
| Liabilities & Equity | |
| Debt | $150,000 |
| Shareholders’ Equity | $500,000 |
| Operating Cash Flow | $0 |
| Investing Cash Flow | $0 |
| Financing Cash Flow | $0 |
| Net Cash Movement | $0 |
| Closing Cash | $180,000 |