Sun Nutracell

This simulation is about a large distribution company Sunflower Nutraceuticals (SNC) which resells products related to snacks. This company undergoes a change in its financial reporting system which was suppose to increase its profits and decrease its cost as well as to compete with its rivals.

Sunflower Nutraceuticals (SNC) Background

SNC is a privately owned nutraceuticals company , it is a distributor which provides dietary supplements, such as herbs, vitamins, and minerals for consumers, distributors and retailers. (Harvard Business School Publishing, 2012). Once the business was initiated after 2006, SNC expanded their operations and came up with various retail outlets in the nutraceutical industry and has been successful while introducing their own brands of sports drinks, vitamins for teenagers, metabolism- boosting powders, etc and various other products from a same product line which enable to enhance the metabolism system of humans.

The company has growth potential however the company is struggling to break even and on more than one occasion has been forced to exceed the company’s credit line to finance their payroll and other operational needs. Because of their somewhat restrictive financing options, they are only able to use a small finance amount to evaluate and invest in new business expansion, which would allow for expansion opportunities in other retail markets across the globe.

Phase 1 of SNC’s Simulation (Years 2013-2015)

During the initial phase of the simulation, there are four major opportunities, which could be considered for the company to maximize their growth, those opportunities include:

I. Discontinuing their Poorer Selling Nutraceutical Products –since they have more than 100 products, some of those products can be dropped off SNC’s inventory because they are outdated. Reducing or discounting those items will allow SNC to a) reduce its DSI to approximately 3 months, b) cut its EBIT by 50k...