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MACAO MANAGEMENT PARAMETERS
TABLE 1 - DEMOGRAPHY
 
           
     
Area ('000 KM2)
 
Population (millions)
 
China
 

9.600
 
     

1200
  North American Free Trade Agreement (NAFTA)
21.457
 
   
278
  Rest of Developed World
44.120
 
   
2.486
         
           
  TABLE 2 - MARKETING COSTS  
 
 
Information on competitors' activities

MOP 75 000
   
  Market share information
MOP 50 000
   
         
  TABLE 3 - AGENTS (CHINA), DISTRIBUTORS (NAFTA) & INTERNET DISTRIBUTOR COSTS  
 
 
Minimum support cost, per agent/distributor, per quarter

MOP 50 000
   
  Cost of setting up an agent/distributor
MOP 75 000
   
  Cost of terminating an agent/distributor
MOP 50 000
   
         
  TABLE 4 - INTERNET COSTS  
 
 
% of value

3%
   
  First time joining fee to Internet Service Provider
MOP 75 000
   
  Quarterly cost per Internet Port
MOP 10 000
   
  Cost of closing down an internet operation
MOP 50 000
   
   
 
     
             
  TABLE 5 - MANUFACTURING PARAMETERS  
 
               
   
Product 1
 
Product 2
 
Product 3
 
  Minimum machining time per unit
60 min.
 
75 min.
 
120 min.
  Minimum assembly time per unit
100 min.
 
150 min.
 
300 min.
  Raw material content per unit
1 unit
 
2 units
 
3 units
               
  TABLE 6 - MAINTENANCE COSTS  
 
 
Maintenance cost per machine, per hour

MOP 850
   
  Cost per hour of emergency maintenance (not contracted for)
MOP 1 750
   
         
  TABLE 7 - MAXIMUM HOURS AVAILABLE PER MACHINE (PER QUARTER, RELATIVE TO SHIFT LEVEL WORKED)  
 
             
 
Shift level
 
Maximum hours per quarter that each machine can work, 
accumulating hours to each successive level of shift
 
Unskilled workers needed for each machine
 
 
Single (1)
588 hours
4
 
Double (2)
1 092 hours
8
 
Treble (3)
1 638 hours
12
             
  TABLE 8 - SCRAP VALUES FOR REJECTED PRODUCTS  
 
               
   
Product 1
Product 2
Product 3
 
  Scrap value per product unit
MOP 400
MOP 800
MOP 1 200
               
  TABLE 9 - CHARGE FOR GUARANTEE REPAIRS & SERVICING  
 
               
   
Product 1
Product 2
Product 3
 
  Retail servicing cost, per unit
MOP 600
MOP 1 500
MOP 2 500
  Note that repairs carried out as a result of a product recall are charged at 75% of normal charge
               
  TABLE 10 - PRODUCTION COSTS  
 
 
Cost of supervision per shift

MOP 125 000
   
  Production overheads, per machine
MOP 35 000
   
  Running cost per machine hour
MOP 80
   
  Production planning cost per unit requested
MOP 10
   
  Cost of quality control department
MOP 80 000
   
         
  TABLE 11 - CONTAINER CAPACITY  
 
   
 
     
      Product 1   Product 2   Product 3  
  Container capacity in terms of products
500
 
250
 
125
  Note: Mixed loads can be carried: eg, 1 unit Prod. 3 = 2 units Prod. 2 or 4 units Prod. 1
                 
  TABLE 12 - TRANSPORTATION COSTS  
 
 
Daily all-in hire cost of container

MOP 6500
   
  Maximun vehicle distance allowed each day
400 KM
   
  Distance to Nafta shipping port
250 KM
   
  Cost of container hire
MOP 80 000
   
  Distance to Internet Distribution Agent
150 KM
   
         
  TABLE 13 - WAREHOUSING & PURCHASING  
 
 
Available raw material storage at factory (units)
2 000
   
  Quarterly cost of factory warehouse and administration
MOP 125 000
   
  Cost of external storage per raw material unit
MOP 25
   
  Cost of storage per product unit at China Agents and Internet   Distributors
MOP 35
   
  Cost of storage per product at Nafta Distributor 
USD$ 4
   
  Premium charge for unplanned material purchase +10% on spot price    
   
 
     
             
  TABLE 14 - METHOD OF CALCULATING AVERAGE QUARTERLY STOCK HOLDINGS & INTEREST  
 
 
0.5 x (opening value + closing value)
     
  TABLE 15 - HUMAN RESOURCE DEPARTMENT COSTS  
 
                   
      Recruitment   Compensation for Dismissal   Initial Training  
  Skilled assembly workers
MOP 20 000
 
MOP 50 000
 
MOP 85 000
  Unskilled machinists
MOP 10 000
 
MOP 20 000
 
---
   
 
       
  TABLE 16 - MAXIMUM HOURS EACH PRODUCTION WORKER CAN WORK AND PAY PREMIUMS  
 
                         
  Shift Level   Hours Per Worker 
at Basic Rate
  Hours Per Worker 
at Saturday Rate
(basic pay + 50%)
  Hours Per Worker 
at Sunday Rate
(basic pay + 100% )
  Machinists
Shift Premium
 
 
Single (1)
 
420
 
+ 84
 
+84
 
0
 
Double (2)
 
420
 
+ 42
 
+84
 
1/3
 
Treble (3)
 
420
 
+ 42
 
+84
 
2/3
       
 
       
  TABLE 17 - MINIMUM HOURS & SALARIES  
 
 
Unskilled machinists' minimum paid hours per quarter
350 hours
   
  Skilled assembly workers' strike hours per week
49 hours
   
  Skilled assembly workers' minimum hours per quarter
0
   
  Skilled assembly  workers' minimum hourly rate of pay
MOP 40
   
  Minimum management budget per quarter
MOP 300 000
   
  Ratio of unskilled machinists' rate of pay to skilled rate
65%
   
   
 
     
             
  TABLE 18 - COST OF MACHINES  
 
 
Cost per machine (total)

MOP 3 500 000
   
  Payable at time of order
MOP 1 750 000
   
  Payable on installation
MOP 1 750 000
   
  Machine rate of depreciation per quarter
2,50%
   
  Decomissioning Charge
MOP 700 000
   
   
 
     
             
  TABLE 19 - METHOD OF COMPUTATIONS  
 
 
Financial Limits Overdraft:

50% of value of (property + raw material stock + product stock)
    plus 90% of debtors
    less 100% tax due
    less 100% of creditors
  Note: All of these values are taken from last quarter's Balance Sheet
 
Borrowing Power:
 
0.5 x (share price at the end of last quarter x number of shares)
    less 100% of (term loans already in place + bank overdraft limit as calculated above)
 
Credit-worthiness for buying machines:

Borrowing Power + Cash + Investments (all from last quarter's Balance Sheet)
    less 50% of the value of each machine due to be installed next quarter
  Note: If any of these limits work out to be less than 0, the limit will be set to 0.
           
  TABLE 20 - FINANCIAL PARAMETERS  
 
 
Tax rate per annum (assessed in the fourth quarter of the year, and paid in the second quarter)
30%
   
  Fixed overheads per quarter
MOP 300 000
   
  Variable overhead rate per quarter
0.30%
   
  Credit control cost per unit sold in China and Nafta
MOP 10
   
  Credit card rate on internet sales
MOP 10
   
 
Interest rates on:
       
  Investments Annual China base rate announced last quarter
  Overdraft Annual China base rate announced last quarter plus 4%
  Unsecured loans Annual China base rate announced last quarter plus 10%
  Term loans Fixed annual rate of 12%
   
 
     
             
  TABLE 21 - PRODUCT STOCK & RAW MATERIAL STOCK VALUATION  
 
 
Product Stock:
     
  110% of the total cost of all products, with each product calculated as:    
        The raw material content valued at six-month price quoted last quarter
      plus The basic skilled wage rate times the assembly-time for the product
      plus (The machining time for the product x 4) x (65% of the basic wage rate) 
        x (the % shift premium)    
 
Raw Material Stock:
     
  90% of the lowest of the Spot, 3-month or 6-month quoted last quarter, times the number of units in stock or due to be delivered
   
 
   
  TABLE 22 - INSURANCE OPTIONS  
 
                 
  Insurance Plan Number   Insurance Excess   Insurance Premiun
 
0
 
100%
 
no insurance
 
1
 
0,10%
 
0,60%
 
2
 
0,20%
 
0,35%
 
3
 
0,30%
 
0,20%
 
4
 
0,40%
 
0,10%
  Note:The monetary value of the primary risk is calculated as: 
the quoted percentage of Property plus Machines plus Raw Material Stock plus Product Stock taken from last quarter's Balance Sheet
   
 
   
  TABLE 23 - TARGET PAYMENT PERIODS FOR DEBTORS  
 
 
Internet

0 days (credit card)
   
  China agents
60 days
   
  NAFTA distributors
90 days
   
         
  TABLE 24 - TIMING OF PAYMENTS TO CREDITORS  
 
 

External Cost Items
(Internal and labor costs omitted)

If goods are delivered or services are provided next quarter,
 the charged amount will be paid:
   
Next Quarter
 
Quarter after Next
  Advertising    
100 %
  Guarantee servicing    
100 %
  Internet Service Provider
100%
     
  Payments to agents and distributors
100%
     
  Transportation costs    
100%
  Warehousing costs    
100%
  Personnel costs
100%
     
  Research & Development
100%
     
  Maintenance    
100%
  Business intelligence    
100%
  Web-site development    
100%
  Other miscelaneous costs
100%
     
  Raw materials (Note 1)
50%
 
50%
  Machines (Note 2)
50%
 
50%
  Interest
100%
     
  Insurance
100%
     
 
Note 1: All materials ordered next quarter (regardless of date of future delivery) will be paid 50% next quarter and 50% in the quarter after next.  The second payment will not be affected by changes in the exchange rate in the meanwhile.
Note 2:  Machines will be ordered next quarter and a 50% deposit paid; and installed in the quarter after next at which time the second 50% of the payment will be made
.
           
  TABLE 25 - WEB-SITE CAPACITY  
 
 
Demand on your web-site will vary considerably from hour to hour across the day. If you are not able to givequick and efficient service to visitors at peak times, your marketing image can decline quite sharply. However, it is difficult to assess the capacity of your web-site which depends on the number of ports linking you to your ISP. The following table gives a guide to the link between ports and service.
 
Number of Ports in parallel

1

2

5

10

20

50
12
24
60
120
240
600
2
7
31
81
190
537
  Maximum theoretical capacity number of visits per hour
  Practical working capacity number of visits per hour
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