SIM Cash-to-Serve

We consider a supply chain with a smartphone supplier (located in South Korea), which fulfills orders placed by customers from China, South Korea, and Japan through the following DCs: Changleng, Tianjin (China), Seoul, Miryang (South Korea), and Hachioji (Japan). Every distributor cash account has its own initial cash and payment terms in every country:

To analyze operating cash flow we need to obtain detailed information on cash flows within the supply chain (including cash on hand, loans, interests, account payable and account receivable) for the period of one year.

The result of the experiment shows that Japan distributor has the required financial solvency. This means that the DPO value of China, and South Korea distributors is too low, or that the down payment ratio (to the supplier) is too high.

 

Related topics

Importing examples 

Running the Simulation experiment