Mohannad Allouzi Christina Cecil

Jordan ConcepcionSeth Cormier

BSG Simulation Group Presentation Company Balance

Our strategy started out with us looking over the how the main competitions in the real world plan their strategies.

We looked at Nike, Reebok and Adidas to see how they strategize from there we decided on trying to be like Reebok by offering above average on premium quality shoes with a slightly lower than average pricing.

As far as corporate responsibility we decided on going with ethics training for all employees, implementing the diversity program and putting in $100 thousand in the energy initiatives.

This strategy has allowed us to win the Corporate Social Responsibility Award for years 14, 15, 17, 18, 19, & 20.

Sadly we only came in came in second place for year 16 for the Corporate Social Responsibility Award.

Company Strategy

Our annual total revenue started at a modest $250,000,000 in year 10 and reached a high of $379,000,000 in in year 16. The largest increase in YOY revenue was from Years 15 ($298 million)-16($345 million). Our company’s goal was to increase our annual revenues 10% YOY with the mindset that or Annual Revenue would outperform our competitors.

Annual Total Revenue

Our annual EPS was originally based on just meeting the investors expectations but quickly evolved to a drive to at least reach double the investors expectation every year for our company. This drive to reach as close as we can to double the investors expectations would continue given if the game were to continue for us.

Annual EPS Targets

Our annual ROE was originally based on just meeting the investors expectations but quickly evolved to a drive to try for 10% above the investors expectations. If this game were to continue we would keep this 10% above goal for our ROE.

Annual ROE Targets

Our annual credit rating was originally based on just meeting the investors expectations but once we reached the credit rating of A+ we worked hard to keep that rating for our company if the game continued we would keep meeting this credit rating for A+.

Annual Credit Rating

Our annual image rating has been about not meeting the investors expectations but trying for 10% above the investors expectations which most years we have come close this or even beaten this if the game continued we would keep our 10% above investors expectations as our goal.

Annual Image Rating

Throughout the years, our stock price started at a modest $30 in year 10 with a low of $24.21 in year 13. In year 16, our stock price had the largest increase from $109 to $158 and was the highest on year 20 at $171.75. Our stock prices grew at a steady pace, and passed the investor’s expectation by a large amount. However, there were years that our stock prices decreased from a YOY stand point. Overall, we believe that our stock price would steadily increase if the game were to continue.

End-of-Year Stock Price

Global market share is a key indicator for a company's competitiveness as it is largely independent of macroeconomic fluctuations and directly comparable across companies.

Global Market Share

Balance’s strategy has evolved over the project years

Balance focuses on offering the best price while still using good materials

We maintain an S/Q rating below the industry average but not by much; within less than one point from Y13 to Y17

Balance offers a significantly higher number of shoe models than the industry average

We have gone from having above industry average operating expenses and costs of good sold to having lower operating expenses and cost of goods sold than the industry average

Balance maximizes the use of our plant capacity to fill branded footwear demand at the expense of private-label sales

Distribution has been the only variance across regions

Strategy Branded Footwear

Shipped shoes produced at the North America plant to fill demand in Latin America Takes advantage of free-trade policy; no tariffs imposed

Shipped shoes produced at the Asia-Pacific plant to fill unfulfilled demand in the North America market

Shipped shoes from Asia-Pacific plant to fill demand in the Europe-Africa market Lowest tariffs out of all markets who impose them Only market Balance pays tariffs in

Took advantage of Asia-Pacific plant location to fulfill demand in the local market

Strategy Branded Footwear:Distribution

Private footwear has been a secondary focus of Balance

Balance has historically maxed out both the North America and Asia-Pacific plant production

After filling all branded-footwear demand, remaining capacity is used to fill private-label demand

Balance has decreased private-label production over the years to zero this last year due to increases in branded demand

Strategy Private Footwear

Steady increase of 2% per year in worker wages

$0.75 incentive pay per non-rejected pair of shoes

Maximized TQM/Six Sigma investment every year ($2.50 per pair)

Used more than 50% superior materials throughout all years

Maximized best practices training every year ($5000 per worker)

Maximized production in both plants every year

Production Strategy & Workforce Compensation

Initially issued 1,750 shares of stock to help finance plant upgrades

Did not issue a dividend any year except FY12 ($1.00 per share)

Balance has no plans to issue dividends over the next two years

Began steadily buying back shares of stock as the years went on

Highest amount of stock issued: 11,750 (FY 12)

Lowest amount of stock issued: 8,162 (FY18)

Took additional, small loan out in FY15

Consistent repayment of loans without significant additions has kept the company’s credit rating an A+ for several years now

Finances Strategy

Is a part of the company marketing plan. therefore, this measurement helps to make the company reach the goals for the aimed markets.

Competition Analysis

Competitive Strengths Competitive Weaknesses

Models Offered Advertising

Model Availability Rebate Offer Wholesale Price Retailer Support Retail Price

S/Q Rating

Celebrity Appeal

Free Shipping

Retail Outlets

Alpha footwear is our closest competitor since they match us very closely in their strategies and execution.

Future Plans to Beat Competition

Competitive Strengths Competitive Weaknesses

Models Offered Retail Outlets Model Availability S/Q Rating Wholesale Price Retailer Support Rebate Offer

Free Shipping

Advertising

Celebrity Appeal

Model Availability Retailer Support

In order to beat our competitors, we will continue our business plan of keeping the best practice methods for quality (training and six sigma)

Increase our advertisement budget via signing contracts with more celebrities.

Enhance and develop our delivery system .

Continue to monitor the closest competitor.

These should result in larger market share in the geographical areas that need improvement.

Future Plans to Beat Competition

Throughout the years of running our company, we learned that the most important factor for being the best in the industry are:

Closely monitor all of your competitors

Have a business plan that differentiates yourself from the completion

In a head-to-head battle with other companies, we found that:

We needed to vastly be above the Investor’s Expectations for EPS and ROE.

Additionally, we found that a company must have an advantage in either S/Q or Pricing in order to be competitive with other companies.

Lessons Learned