THE LIMIT OF INVENTORY

Med Seghair; WARTSILA- GULF

# Finding the Routine, How?# The cash flow a liquidity# The capacity of your team?# The market capacity /trend# Forcast optimisation# Forseen the furure# The Inventory and Delivery time impact

# Finding the Routine, How?

Energy Solution?- Number of MW/Year - % of the Market- Type of engines- Size of plants- Region trend- Cycle of the business- Profitability vs cash flow- Advantage of Inventories

Marine solution?- Number; Types of ships build- Type of engines needed- Trend of shipyard- Auxilaries - Engineering capabilities- Paymnet guarantee- Cash Flow trend - Classification of costumers

• Inventories are good when

• a) QUICK DELIVERY EXPECTED TO BRING HIGH PROFIT• b) MANUFACTURED GOOD ARE FUNCTIONAL / NOT SUMI FABRICATED• c) AVAILABLE STORAGE AREA /Free / Low cost• d) LOW FACTORY LOAD DURING INVENTORY MANUFACTURING• e) STORAGE TIME LESS THEN 12 MONTHS• f) INCREASE THE COMPANY EBIT AND REDUCE INSURANCE FEE`S• g) REDUCE DILIVERY TIME OF PROJECTS• h) BUILD ON HIGH PREDICTIBILITY

• Inventories are NOT good when

• a) DONE TO BOOST THE FACTORY ACTIVITY • b) ONLY SUMI FABRICATED GOOD, NO FUNCTIONALITY, UNFINSHED• c) COSTLY STORAGE TIME AND AREA• d) DONE TO POSPONE IMPORTANT PROJECTS• e) HIGH STORAGE TIME , MAINLY IF CONTAIN HIGH TECH• f) THE GOOD WILL BE SOLD WITH LOW PRICE, AND REDUCE THE

COMPANY REPUTATION, • g) OUTDATED GOOD REPLACE MODERN AND EFFICIENT ONE

• Down Payment• Cash Flow• L/C • Delivery Time• Credit• Milestone payment