Customer Concentration versus Fragmentation and its Implications in Corporate Risk
Jorge Mongay Hurtado
This research explores on one side, the composition and structure of databases of clients in a total of 204 multi-sectorial companies based in Spain, Thailand and Indonesia. The criterion used to differentiate a customer´s database structure relates to its degree of “fragmentation” versus “concentration”. Also, the research has determined a risk model using a statistical Monte Carlo simulation method in each company. Both, risk levels expressed as certainty to obtain levels of profits and type of customer´s database structure have been analyzed under an Anova test and multiple correlation analysis exploring a total data of N=1020. Results are quite relevant with a conclusion that the volatility of sales affects significantly the changes in the values of certainty of profits, (although not directly to the levels of risk or certainty) related to the achievement of certain results in profits. Consequently, managers should be aware of the importance of a robust quantitative and qualitative accurate sales forecasting method which will contribute with no doubt to decrease corporate risk being extremely helpful when presenting plans or forecasts in front of any kind of stakeholders.
Keywords: Customer´s Database, Risk Analysis, Sensitivity Analysis, Management Strategy
The Penalty Production Model – An Alternative Working Capital Solution for Reverse Supply Chains
Anca Iuliana Nicolae
The working capital issue increased lately for small and medium-sized companies which strived to behold their position on the competitive market in the long term. A shift in competition from firm versus firm to supply chain versus supply chain increased the role that every member of the supply chain had in its long-run development or failure. This paper presents an alternative working capital production model which collects its working capital needs by using an auto-financing method in the sorting stage of the recycling process for reverse supply chains. The penalty system was designed by the author (as part of the operative drift for one of the largest Norwegian recycling companies) as an aggregation of penalty types and their respective amounts for each category that a load can comprise at the entrance in the manufacturing area. Results generated by the new production system highlighted the fact that working capital could be obtained by auto-financing mechanisms, and that the total income could be higher than the value based on a fixed-fee penalty system (the complex model doubled previous income already one year after new system was implemented), achieving in the same time better waste control between original waste declaration and handled waste resulted after the sorting process. Moreover, the sorting facility decreased its own production costs (since extra working capital was generated by applying the auto-financing mechanism), and obtained better control for every fraction processed at the plant (dangerous waste presented in this study) between invoiced volumes and quantities shipped forward in the reverse supply chain.
Keywords: Production Model, Reverse Supply Chains, Sorting Process, Supply Chain Finance, Working Capital
Economic Consequences of Peak Oil for the Major Multinational Oil and Gas Companies
Antonio García-Amate, Alicia Ramírez-Orellana, and Mª José Muñoz-Torrecillas
The main goal of this work is to analyze the financial statements of the five major multinational oil and gas companies, for the 2011-2015 period, in the framework of the peak oil phenomenon. Peak oil can affect key financial indicators (e.g., earnings volatility, leverage) that are used by managers, investors, and stockholders and which may potentially lead to changes in the decision making by management. Our results show that the decline in oil production affects the decisions about investment in new oil wells, leverage, dividends paid, shares purchased and net income involving the five major companies. In addition, we study the evolution of oil prices, and its influence in several items of the financial statements. Even though oil prices were at high levels during 2011-2014, however, the net income of the five companies actually declined due to the impact of peak oil. Finally, data for the last year studied (2015) indicate a general deterioration in return ratios and other accounting variables. Although the new investments should have been profitable, they have been influenced by peak oil, compromising the economic position of the companies. The advice to these companies would be to relax their investments, especially during a period of falling oil prices. Company managers need to recognize the prolonged duration of peak oil and price trends to promote profitability recovery decisions.
Keywords: Brent, Earnings, Financial Statement Analysis, Oil and Gas Industry, Peak Oil, Production
Value Added as a Measure of Social Role of Cooperatives
Krystyna Zimnoc and Barbara Mazur
In the 21st century, cooperatives remain an alternative form of production and consumption throughout the world. The literature draws attention to the specificity of a cooperative enterprise, problems with the use of the profit category as a measure of its activity, lower profitability. The purpose of the cooperative – enterprises and members’ associations – remains the utility, which will consist of a profit for a cooperative enterprise and services for members. The goals of the cooperative must be measured with measures broader than the profit category. The article aims to propose a tool in the form of a report on added value. This measure accurately reflects the level of effectiveness of a cooperative enterprise and the achievement of members’ goals. The study examined the financial statements of selected cooperative enterprises from the food and dairy industry in Poland for the years 2007-2016. Based on the data obtained, a report on the value added (GVA) of the surveyed enterprises was prepared. The results show a high share of members of cooperatives and employees in the use of GVA. It is from 46 to 84%, compared to 42% for the whole economy. Cooperatives allow a more even distribution of income and thus contribute to sustainable development.
Keywords: Gross Value Added, Co-Operatives, Objectives Of The Cooperative Enterprise, Consumer Cooperatives, Dairy Cooperatives, Poland
Impact of Technological Innovation on the Growth of Internationalized Small Enterprises: A Case Study Based on Tech-Based Internationalized Seafood Processing Small Enterprises of Puttalam District in Sri Lanka
W.M.S.N. Fernando and S.W.S.B. Dasanayaka
The main aim of this study is to identify the impact of Technological Innovation (Technopreneurship) on Enterprise Growth with special concern on tech-based internationally oriented Seafood Processing SEs in Puttalam district of Sri Lanka as the existing gap of this research’s scope is very much high in Puttalam district. This research considers mainly four types of Technological Innovation based on Machine Technology, Computerized Operations, Mobile Technologies and Other Communication Media Technologies. From the sample of 33 tech-based internationally oriented Seafood Processing SEs out of the total population of 39, primary data is collected using a questionnaire followed by a Descriptive plus an Ordered Logistic Regression Analysis was performed. According to the results, the growth of Machine Technology, Computerized Operations, Mobile Technologies and Other Communication Media based Technological Innovation (Technopreneurship) lead for Enterprise Growth. The more current the extents of Machine, Computerized Operations, Mobile and Other Communication technologies, the higher the positive contribution for Technological Innovation performance. Also, the Machine Technology Usage is high thus the Innovation performance based on Machine Technology is almost 50% while the Computerized Operations Usage is low. Among the users, the Innovation performance is at a higher level. Present Mobile Technologies Usage is high, thus the Innovation performance based on Mobile Technologies is almost 55%. Though the Other Communication Media Usage is high, only 53% performed innovation. Inadequate finance, poor awareness on international market conditions, lack of the knowledge and trust along with inadequate infrastructure are identified as the main reasons for the lower orientation of internationally oriented Seafood Processing SEs. To promote tech-based internationally oriented Seafood Processing SEs in Puttalam district, providing tech-education among SE owners is essential where there is a requirement of internationally oriented Seafood Processing Industry Establishment of a good financial and credit assistance and a comprehensive national policy for the international operations of tech-based Seafood processers are also essential.
Keywords: Technological Innovation, Tech-Based Internationally Oriented Seafood Processing SEs, Enterprise Growth
Aksemsettin Mah. Kocasinan Cad.
Erenoglu Is Merkezi
Fatih – Istanbul, TURKEY
Email: [email protected]
This work is licensed under a Creative Commons Attribution 4.0 International License.