Yesterday our maths workshop involved looking into the maths behind supply chain and global food. We talked about food miles and how some of the food we buy in supermarkets travels thousands of miles from countries on the other side of the world like New Zealand. Food that has had to ravel a long way to reach our supermarkets are said to have a large carbon footprint.
The Game
Richard had us play a business simulation game which required us to work in pairs and act as demand suppliers. Each pair was given €5000 to start with, and a list of items (SKUs) that we could spend this money on. We were allowed to order a maximum of 5 SKUs per sales period (which was quarterly, starting in April). It was important that when choosing our stock, we considered what time of year it was, as there were items available such as turkeys and selection boxes, which would probably be silly to buy in April, May and June, but very sensible in October, November and December! So for this first quarter, the items that caught my eye were ice cream wafers (summery), bananas (also summery), bread and milk. We didn’t spend all of our €5000 budget on this and made sure we had €1500 left over in case some of our stock wasn’t fully sold. Richard read out the sales figures by giving us the percentage that was sold. We had left over items across the board, but unfortunately with our bananas, milk and bread, we could not carry these over into the next quarter as these items go off quickly. Which meant we ended up wasting quite a bit of money. Regardless, we now had €8820 to take into the next quarter.
Moving into the second quarter (July, August, September), we kept our ice cream stock from the first quarter, stuck with our bread and milk (decreasing the quantity of units due to wastage in first quarter) and introduced soft drinks and beans into our stock list. Our thinking behind the soft drinks was that the weather is pretty hot at this time of year, people are going to be buying more soft drinks! We considered adding beer to our stock list for the same reason, but it was adding the beans that turned our fortunes around. What I noticed about the beans was the striking difference between the purchase price (€0.25) and the seasonal selling price (€2.00). This was 8 times the purchase price!! I wondered if anyone else had noticed this…. and it definitely encouraged me to look closer at the differences between the purchase and selling prices for the next two quarters. I had overheard some people talking about the champagne, and how it had such a high selling price, which I had originally fallen into the trap of thinking. However looking at the purchase price for champagne, it was €10, half of the selling price, which compared to the beans was nothing special. Funnily enough, for that quarter, the beans ended up giving me back the most amount of money (€9600), having only invested €2000.
We continued to use this method, of mainly investing our budget into buying more of the tins of beans. In the third quarter we invested in Christmas selection boxes, Turkeys and Hampers (due to the time of year), which proved a good decision because 100% of all of those units were sold. We also increased our bean quantity from 8000 to 10,000 units, giving us €18,000, and €57,965 in total at the end of the third quarter. In the final quarter we went back to our milk and bread, figuring that at this time of year people are short on cash and are therefore buying the basics, and upped the quantity of beans to 40,000. This was because now, instead of the beans being sold for 8 times their purchase price, they were being sold for 10 times. This ended up giving us back €100,000, due to 100% of the beans being sold that quarter.
At the end of the task, we ended up managing to turn our initial budget of €5000, into €184,440, mainly thanks to beans! This task definitely taught me not to jump into looking at the face value of things. Yes, the Champagne had a very high selling price in the first two quarters, but just looking at that factor would be silly.
Many basic mathematical topics and ideas were used in this task, such as multiplying, dividing, adding and subtracting, percentages and decimals. We were also encouraged to think about wider society, what the public may be buying at certain times of the year and basing our decisions around that and importantly, the purchase and selling prices. This task involved a lot of trial and error, but I think that was a very important part of the game. it made me realise that with maths you might not get it perfectly right straight away but by adjusting things and thinking back to basic ideas it can be made clearer. I feel it is crucial to portray this message to the children we teach, especially those who may feel they have some anxiety towards maths.
