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Salix
 

Salix

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    Salix Salix Presentation Transcript

    • SalixCapabilities and Efficiencies
    • Agenda→ Executive Summary→ Link Chart→ Capacities→ Third Party Manufacturers→ Efficiencies→ Questions→ Contact Information
    • Executive Summary→ Only as capable as their ability is to attractthird party manufactures→ Focuses on a niche market→ Efficient, but room for improvement
    • Capacities
    • Capacities Salix has no manufacturingcapabilities, due to the fact that all theirmanufacturing is contracted out to third parties.
    • Is this Good or Bad?
    • The downside is that they are dependent on third party companies to work with them and manufacture their products The benefit of thispractice is that Salix is not constrained byinternal manufacturing limitations.
    • Salix focuses on a niche market insideThe the pharmaceutical industry Gastroenterology Industry
    • Pharmaceutical Industry Gastroenterology Industry This allows Salix to compete withlarger the research andcompanies that All pharmaceutical development focus on broader markets solely on done at Salix is focused within the pharmaceutical industry gastroenterology
    • 150 100 call on 10 sales managersSalix has approximately 280 fullfocus ondedicated to roughly 16,000 who time health care major drug sales employees professionals wholesalers
    • RaleighNorth Carolina Morrisville North Carolina
    • Lease expires in 2015 Headquarters Lease expires in 2011 Morrisville North Carolina Raleigh North CarolinaSalix also maintains a small amount of 77,000 SQFT space in Palo Alto, California. 26,000 SQFT
    • Third PartyManufacturers
    • All of products that Salix Produces
    • All of Salix’s third party producersOverall, Salix has 20 Third Party Producers
    • ` Efficiencies
    • Average Inventory Inventory to Investment Sales Ratio Period RatioThe Analysts used four different ratios to These ratios are as listed as follows; determine Salix’s Efficiency Asset Accounts Turnover Receivable Ratio Ratio
    • This ratio can be calculated byThe Inventory to Sales Ratio determines Inventoryhow much inventory is sold inInventory to = a month Sales Ratio Sales for the Month
    • Inventory to Sales Ratio 4 3.653731343 3.5 3.375 3.462365591 3 3.036966825Inventory to Sales Ratio 2.5 2.317241379 2 1.797288573 1.548387097 1.5 1.444604317 1.161073826 1.548387097 1 0.900763359 0.5 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 years Trending Down = EFFICIENT
    • This ratio can be calculated by A higher investmentAThe Average Inventory Investment Period longer average in inventory means Ratio determines how long itcash availableinventory period takes to Average less Investmentrequires a higher Average Inventory The higher theCurrent Inventory Balanceother into a dollar efficient outflow cash for Inventory convert a the less of cash the company is flows Period is, investment in = Investment dollar of sales/ accounts receivable from (i.e. paying inventory Daily Cost ofbills, overhead, ext.) Average Period the sale of the inventory Goods Sold (COGS) Ratio
    • Average Inventory Investment Period 0.9 0.772727273 0.780701754 0.8 0.8 0.768292683 0.73853211 0.7Average inventory investment Period 0.6 0.560386473 0.482288828 0.5 0.4 0.456363636 0.3 0.2 0.173913043 0.1 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 Years Trending Up = INEFFICIENT
    • This ratio can be calculated byThe Asset Turnover Ratio determines how Revenue well a business is using it’s assets to Asset = generate sales Turnover Assets Ratio
    • Asset Turnover Ratio 1.4 1.225749559 1.158068057 1.2 1.206755374 1.132309942 1 0.885714286Asset Turnover Ratio 0.960257787 0.8 0.600536193 0.647331787 0.6 0.570866142 0.5 0.4 0.2 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Year Trending Up = EFFICIENT
    • This ratio can be calculated by The Accounts Receivable Ratio Accounts ReceivableRepresents the number of sales for which Accounts = collected payments have not yet been Receivable Sales Ratio
    • Accounts Receivable Ratio 0.45 0.427586207 0.4 0.35 0.295923261Acounts Receivable Ratio 0.3 0.25 0.251129761 0.221374046 0.179104478 0.2 0.226510067 0.107142857 0.15 0.099526066 0.1 0.096774194 0.064516129 0.05 0 1999 2000 2001 2002 2003 year 2004 2005 2006 2007 2008 Trending Up = INEFFICIENT
    • Questions
    • Contact Information