Working capital efficiency

Sometimes, fixed assets are purchased via short-term loans, which can lead to hquidity problems. For the most part, fixed assets should be financed from long-term or permanent capital such as stocks or bonds. The proven abihty of management to handle working capital efficiently will put a company in a better position to obtain such longterm capital when required, because the confidence of bankers and stockholders will have been obtained. 

The five basic drivers of enhanced shareholder value are shown in Figure 3.4. They are revenue growth, operating cost reduction, fixed capital efficiency, working capital efficiency and tax minimisation. All five of these drivers are directly and indirectly affected by logistics management and supply chain strategy. 

Working Capital The amount and disposition of working capital and the efficiency of its use determine the immediate prospects for future growth in a company. The bulk of managerial effort in a company is directly or indirectly concerned with the manipulation of working capital. Insufficient or misused working capital is the commonest cause of business failure. 

Competition. The focus on the efficient transaction pushes costs and working capital backward in the supply chain. The realization that the most effective supply chain is not the most efficient is only understood by a few leaders. 

Generally, maintenance works are considered as those for maintaining the capital invested while rehabilitation works are considered as those for increasing capital efficiency. 

ROA provides a general proxy for the overall operational efficiency of a company—that is its ability to utilize assets (input) to generate profits (output). Since inventory capital is included in the total assets, reducing inventory capital may increase ROA for the same annual income, as long as it decreases assets in total (see "Working Capital" below for details). 

To improve supply chain asset management efficiency The effectiveness of an organization in managing assets to support demand satisfaction. This includes the management of all assets—fixed and working capital... 

Shin H, Soenen L (1998) Efficiency of working capital and corporate profitability. J Fin Pract Educ... 

The CCC directly affects cash flow, which affects working capital requirements and corporate value. CCC is used to determine the amount of cash (working capital) needed to fund ongoing operations. Cash that is unavailable because it is tied up in inventory or because customers still owe to the company cannot be used for ongoing operations. A company that is not operating efficiently will see an increase in working capital. 

Even when the time comes to make a purchasing decision, an energy-efficient motor purchase is not a certainty. Sometimes an energy-efficient motor will be the economically efficient choice at other times, not. The capital investment decision is based on the cost in relation to performance, efficiency and reliability. Moreover, the decision depends on the application and the amount of time the motor is in operation. It can be the major component of a product (drill or mixer), or a minor component (computer disk drive) it can be the major component cost of a product (fan), or it can be a minor component cost (stereo tape deck) it can run almost constantly (fan, pump, and machinery), or only a few minutes a day (vacuums and power tools). For example, contractors purchase circular saws almost solely based on performance and reliability. Time is money, and since the saw is operating only a few minutes a day and the contractor is often not responsible for the electricity costs to run the motor, energy efficiency is not a consideration performance and reliability are what matter most. On the other hand, an industrial user, who runs huge electric motors twenty-four hours a day to work pumps, machinery, and ventilation equipment, is very concerned tvitli energy efficiency as well as performance and reliability. 

The fluorescent components are denoted by I (intensity) followed by a capitalized subscript (D, A or s, for respectively Donors, Acceptors, or Donor/ Acceptor FRET pairs) to indicate the particular population of molecules responsible for emission of/and a lower-case superscript (d or, s) that indicates the detection channel (or filter cube). For example, / denotes the intensity of the donors as detected in the donor channel and reads as Intensity of donors in the donor channel, etc. Similarly, properties of molecules (number of molecules, N quantum yield, Q) are specified with capitalized subscript and properties of channels (laser intensity, gain, g) are specified with lowercase superscript. Factors that depend on both molecular species and on detection channel (excitation efficiency, s fraction of the emission spectrum detected in a channel, F) are indexed with both. Note that for all factorized symbols it is assumed that we work in the linear (excitation-fluorescence) regime with negligible donor or acceptor saturation or triplet states. In case such conditions are not met, the FRET estimation will not be correct. See Chap. 12 (FRET calculator) for more details. 

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