Bevco Business Simulation
Bevco Business Simulation® is an innovative experiential learning tool that allows student to assess market opportunities, launch new business ventures, and craft and execute business strategy. The simulation facilitates learner-to-learner and learner-to-faculty engagement and is keyed to competency goals for courses in Introduction to Business, Management, Entrepreneurship, Marketing, and Strategic Management.
Marketed by McGraw-Hill Higher Education
OVERVIEW
Students participating in Bevco Business Simulation® will launch and manage a nutritional beverage company operating in a dynamic, competitive environment. Up to 12 decision rounds can be scheduled to allow students to provide proof of its business concept and test the effectiveness of their new company’s business model, strategy, and implementation efforts.
Instructors may assign the project individually to students or may assign the simulation as a team project. The student co-founders and managers of the new venture will be responsible for assessing opportunities in the nutritional beverage industry, determining the key elements of the company’s value proposition and how the company will be positioned in the industry, developing a viable profit formula allowing for financial performance meeting investors’ targets and make decisions relating to:
- Product quality
- Health and wellness properties
- Brand image
- Sustainability rating
- Wholesale price charged to convenience stores and supermarkets
- Retail price charged to online consumers.
VALUE DRIVERS
In developing a customer value proposition and a competitive strategy, students are able to select a variety of decision option affecting key competitive variables as described below:
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Product Quality
Impacted by decisions the reputation of the company's suppliers, number of beverage varieties and flavors, and quality control budget relative to the volume of production orders.
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Health and Wellness
Determined by the use of standard or organic ingredients, optional ingredients offering specific health and wellness properties, and the reputation of the company's suppliers.
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Brand Image
Affected by supplier reputation, ingredient quality, grade of beverage packaging selected, the use of sustainable farming partners, the number of beverage varieties and flavors, price, advertising budget, website development budget, size of a company's retail network, and customer service.
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Sustainability Rating
Impacted by the quality of ingredients, inclusion of optional ingredients offering specific health and wellness properties, environmentally sustainable packaging materials, supplier reputation, and the use of sustainable farming partners.
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Pricing
Students are able to set pricing in both brick-and-mortar locations and the company's online retailing site.
Decision entries required in each competitive round include choices concerning:
Purchasing- Standard or organic ingredients
- Various optional ingredients such as preservative-free, non-GMO, and nutraceutical ingredients
- Selection of suppliers based upon reputation
- Grade of packaging materials
- Optional packaging materials such as plant-based bioplastics, recycled materials, or glass
- Optional use of sustainable farming partners
Production
- Number of cases of beverages ordered from contract manufacturers
- Number of flavors and varieties
- Quality control budget to supervise the bottling process
Marketing
- Wholesale price per case charged to retailers
- Size of retail network
- Level of customer service provided to retailer accounts
- Size of the advertising budget
- Online retail price per case charged to consumers
- Level of customer service provided to online consumers
- Optional free delivery to online consumers
Financial, competitive, and triple bottom line KPI data is provided following each decision round deadline. Students can assess KPIs and projected and actual income statements and cost reports to evaluate the effectiveness of the company’s value proposition and profit formula. The iterative decision-making process allows the co-founders/managers of each company to validate their business model and competitive approach.
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