Working Capital Simulation Essay Example for Free

Working Capital Simulation EssayThis simulation has given me a better under erecting of what managers and CEOs go finished when making decisions for the company. As I went through each simulation more than once to see what affects the decisions had on cash flows, sales and EBIT. In about situations they changed whether it dropped or risen, and others they were completely stagnant with their movement through each phase. Below I will pull d give birth out how and why I made each decision.Phase 1, I chose to acquire a innovative guest and tighten up accounts receivable in both times I did the simulation. I chose to posit on a new customer because SNC needed the exposure to become known as it is attainset to get widespread exposure. The results of this acquisition were that it change magnitude the sales significantly but also left us with higher receivable an inventory balances. (Harvard SNC Synopsis) The results of tightening up the accounts receivable were that sales have declined but the receivables better which freed up cash. (Harvard SNC Synopsis)In phase 2, I chose to expand the online presence as well as beat a private strike out in one simulation and the second simulation I simply chose to expand on line. In my first choice since I chose to expand online and develop the label, the amounts varied in increase of cash flows. The refinement of the online presence increased Internet sales and the private label increased the EBIT margin only a little. This also counteracts with the accounts receivable and inventory balances after phase one. But it was not that drastic of a change. In 17 there was no increase or decrease in cash flows, which only means that in that year we broke even on the developing label side.The last phase, I chose to adopt a global expansion schema in one attempt and in the second I chose to adopt and acquire the high-risk customer. The results of acquiring a high-risk customer increase the sale, but had a dramatic affect on the receivables. SNC has now to consider witting off a portion of the outstanding balance as the company Midwest Miracles filed for chapter 11 bankruptcies. This simulation alone has taught me one of the many risks of doing business with any company. (Harvard SNC Synopsis) I thought that after acquiring the company, they could maybe stand on their own with the help of SNC and pull out of their financial hardship. It had the complete opposite affect on the SNC and it could have potentially ruined my company, as well as made me lose investors. The global expansion however helped the SNC get on its top of the line with the new customer Viva Familia. Like expanding online, the global strategy was another attempt to draw and quarter sure SNC is the first company consumers think about when dietary supplements. limiting access to financing can hinder any company or person from delivering to grow their business. It can cause higher interest rates on loans and credit fees as well as f orce businesses to face hardships when it comes to registration costs, policies and equipment needed for the business. (Parrino, Kidwell, $ Bates, 2012) It can also limit the profits they may toy with consumers on in the new market. The limit of access to finances also hinders the process to develop and own their own brand of products.Making a if I were really the CEO of SNC or any business, I would need the help of a team to help make these decisions on and expansion and growth as well as investing in other companies. This simulation put in perspective the achievement set and education needed after studying finances to even hope that you can make a profit on any decision made. It is a really difficult task to try and manage a company as well as keep up with the market. If this were a fillet of sole proprietorship, it would really be stressful to handle all by their lonesome.ReferenceHarvard Business Publishing. (2012). Working bully simulation managinggrowth. Retrieved May 16th, 2915 from, http//forio.com/simulate/harvard/working-capital/simulation Parrino, R., Kidwell, D.S, Bates, T.W. (2012) Fundamentals of corporate finance (2nd ed.) Hoboken, NJ Wiley