Running head: UNIT VII ESSAY 1
MBA 6081
Unit VII Essay – Supply Chain Management
Columbia Southern University
MBA 6081 - Corporate Finance
Supply Chain Management and Days Working Capital.
As a child, my dad and I carved a small block of pine into a pinewood derby race car. The
little cars raced down a wooden track, powered only by gravity. The more efficient the car
design, the faster it would go. Supply chain efficiency is measured in working capital. A Days
Working Capital (DWC) refers to how many days it takes an organization to convert working
capital into revenue.[ CITATION Mur20 \l 1033 ] More days of working capital held means
more time needed to convert capital into product or sales; less days imply more efficiency.
Calculating DWC is a relatively simple equation; subtract current liabilities from the current
assets and multiply the difference by 365 (days in a year), the product is then divided by sales
revenue.
((Current Assets-Current Liabilities)*365)/Sales Revenue [ CITATION Mur20 \l 1033 ]
Company Selection and Competition
For this exercise, the chosen company is Volkswagen Aktiengesellschaft, also known
as Volkswagen AG; comparative data is pulled from 2019, the last full year VW has on file.
The competition selected are Toyota and Honda because they also have very diverse portfolios
and are not just automobile manufactures. VW is expanding into Electric Vehicles, Honda
makes anything with a motor, and Toyota is known for heavy industry products such as
forklifts.
Company *Worldwide **Current **Current Year **Sales Days of
Vehicle Assets Liabilities (in days) Revenue Workin
Sales g
Capital
MBA 6081
Unit VII Essay – Supply Chain Management
Columbia Southern University
MBA 6081 - Corporate Finance
Supply Chain Management and Days Working Capital.
As a child, my dad and I carved a small block of pine into a pinewood derby race car. The
little cars raced down a wooden track, powered only by gravity. The more efficient the car
design, the faster it would go. Supply chain efficiency is measured in working capital. A Days
Working Capital (DWC) refers to how many days it takes an organization to convert working
capital into revenue.[ CITATION Mur20 \l 1033 ] More days of working capital held means
more time needed to convert capital into product or sales; less days imply more efficiency.
Calculating DWC is a relatively simple equation; subtract current liabilities from the current
assets and multiply the difference by 365 (days in a year), the product is then divided by sales
revenue.
((Current Assets-Current Liabilities)*365)/Sales Revenue [ CITATION Mur20 \l 1033 ]
Company Selection and Competition
For this exercise, the chosen company is Volkswagen Aktiengesellschaft, also known
as Volkswagen AG; comparative data is pulled from 2019, the last full year VW has on file.
The competition selected are Toyota and Honda because they also have very diverse portfolios
and are not just automobile manufactures. VW is expanding into Electric Vehicles, Honda
makes anything with a motor, and Toyota is known for heavy industry products such as
forklifts.
Company *Worldwide **Current **Current Year **Sales Days of
Vehicle Assets Liabilities (in days) Revenue Workin
Sales g
Capital
