Subsidaries - what are they actually good for?
Posted: Sun Mar 26, 2017 8:45 pm
Hi everyone!
I am having trouble understanding the use of subsidiaries and I hope someone could enlighten me on how to approach this.
I was attempting to do the 'complete market dominance for all products'-challenge on high difficulty.
Got off great by getting into multiple areas, got a great profit and thought I could increase expansion rate by adding some subsidiaries that could focus on specific product groups.
BUT, having a subsidiary company seems to be totally useless since they seem incapable of even the most basic things (getting products on the market).
I created 4 private companies each with focus on different areas (automobile, snacks & food, furniture, computers)
I gave each a healthy cash reserve of around 500M and hired a good CEO with expertise in their area & points into retailing etc...
There was close to no competition in these areas. And the end result are quite similar to this (might misremember some details)
After running for about 5-10 years, they have done almost NOTHING, they have each put 0-2 items on the market, and have all kinda run out of cash despite getting cash injections.
My best subsidiary was the furniture one, who managed to purchase cotton & leather from my farms, purchase a timber resource, setup one factory and then run 2 department stores (4 cities) selling sofas, they were at least making a tiny profit and didn't run out of cash (had about 100M left of original startup capital, and yearly result slightly positive - but didn't produce or research any new items after sofas...)
The others hadn't even started a factory, or had one factory but no retail stores, tried selling intermediate goods such as 'wheels & tires' without going for selling a 'car' & hence bleeding money each month.
The computer focused company built 1 mine, 1 factory split between CPU, circuits & desktop computers did some research but could not produce & sell enough computers to 'make a profit', and was overrun by a competitor after 6 years of service.
After watching the automobile guy struggle I took another approach: I gave a lot of money, transferred factory, produced all 'required semi-products' that they could access (steel, rubber, silica), but they didn't setup retail stores or chains.
So,
Leaving them alone - they did 'close to nothing'
Enforcing factories on them - they did not build retail stores
Enforcing retail stores on them - they did not build factories or try to sell new products
Enforcing empty retail + factories on them - they did not setup new product chains
Even the 'healthy furniture one' failed to expand product into all cities, or produce enough sofas to get market share despite that being a priority in their setting (or make beds/chairs etc)
How come they are so incapable?
What are they supposed to be used for?
How do you guys setup your subsidiaries?
Any success stories related to subsidiaries?
Cheers,
MesSer
I am having trouble understanding the use of subsidiaries and I hope someone could enlighten me on how to approach this.
I was attempting to do the 'complete market dominance for all products'-challenge on high difficulty.
Got off great by getting into multiple areas, got a great profit and thought I could increase expansion rate by adding some subsidiaries that could focus on specific product groups.
BUT, having a subsidiary company seems to be totally useless since they seem incapable of even the most basic things (getting products on the market).
I created 4 private companies each with focus on different areas (automobile, snacks & food, furniture, computers)
I gave each a healthy cash reserve of around 500M and hired a good CEO with expertise in their area & points into retailing etc...
There was close to no competition in these areas. And the end result are quite similar to this (might misremember some details)
After running for about 5-10 years, they have done almost NOTHING, they have each put 0-2 items on the market, and have all kinda run out of cash despite getting cash injections.
My best subsidiary was the furniture one, who managed to purchase cotton & leather from my farms, purchase a timber resource, setup one factory and then run 2 department stores (4 cities) selling sofas, they were at least making a tiny profit and didn't run out of cash (had about 100M left of original startup capital, and yearly result slightly positive - but didn't produce or research any new items after sofas...)
The others hadn't even started a factory, or had one factory but no retail stores, tried selling intermediate goods such as 'wheels & tires' without going for selling a 'car' & hence bleeding money each month.
The computer focused company built 1 mine, 1 factory split between CPU, circuits & desktop computers did some research but could not produce & sell enough computers to 'make a profit', and was overrun by a competitor after 6 years of service.
After watching the automobile guy struggle I took another approach: I gave a lot of money, transferred factory, produced all 'required semi-products' that they could access (steel, rubber, silica), but they didn't setup retail stores or chains.
So,
Leaving them alone - they did 'close to nothing'
Enforcing factories on them - they did not build retail stores
Enforcing retail stores on them - they did not build factories or try to sell new products
Enforcing empty retail + factories on them - they did not setup new product chains
Even the 'healthy furniture one' failed to expand product into all cities, or produce enough sofas to get market share despite that being a priority in their setting (or make beds/chairs etc)
How come they are so incapable?
What are they supposed to be used for?
How do you guys setup your subsidiaries?
Any success stories related to subsidiaries?
Cheers,
MesSer