Presentation:

BROWN MARINE
SUPPLY COMPANY

Presentors:
Abid Khan (Specialization H.R)
Muiz Hassan (Specialization Marketing)
Yasir Wahab (Specialization Finance)
Kamil Afridi(Specialization Marketing)
Today We are here to present you the case study on Brown
Marine Supply Company.

TABLE OF CONTENTS

The Overview
Point of View
Problem Statement
Objectives
Situation Analysis
The Alternatives
Recommandations

CASE STUDY: Brown Marine Supply Company

The Overview of the Case Study

2.
Point of View
Lets start with the first content!

Point of View:
We are trying to present the
case from the financial
consultants point of view.

3.
Problem Statement
What sort of problem the company is facing!

Problem Statement
The company is facing the cash
shortage issue.
The companys cash balance had
fallen below $2,000.
And have to pay for outstanding
accountpayables to its suppliers.

4.
Objectives
What are the set of goals that are to be achieved!

Objectives
To organize cash in such a way
that Brown Marine Supply
Company has enough cash in
order to make prompt payments
against outstanding payables.
To ensure that Brown Marine
Supply Company has proper
mechanism for the speed up
collection of outstanding
receivables.

5.
Situation Analysis
What are the important points of the case, that are
useful for the result.

Situation Analysis
Companys cash balance has fallen below $2000.
Company has to pay for outstanding payables by
the end of the week.
While making consistently profits, company was
getting shorter & shorter of cash.
Mr. Brown, the owner has decided to extend the
borrowing limits, which was already being fully
used.
Despite growing sales & continued profitable
operations, the company has always seemed to
be short of cash on number of events.
Company was also failing to take advantage of
prompt payment discounts (i.e. 2%, 10 days, net
30 days).

Exhibits & Ratio Analysis

Financial Statements of the case

BROWN MARINE SUPPLY COMPANY

Liquidity Ratios
Ratios

May 31

June 30

July 31

Current Ratio

2.51

2.49

2.69

Quick Ratio

1.97

1.94

2.06

150,048

163,605

175,430

Working
Capital Ratio

BROWN MARINE SUPPLY COMPANY

Profitability Ratios
Ratios

May 31

June 30

July 31

Gross Profit
Margin

24.40%

23.48%

22.95%

Net Profit
Margin

11.23%

11.85%

11.00%

3.64/5.62

4.33/6.76

3.70/5.88

Return on
Assets/Return
on Equity

BROWN MARINE SUPPLY COMPANY

Efficiency Ratios
Ratios
Receivable
Turnover/Avg
Collection
Period
Inventory Turn
Over
Days in
Inventory

May 31

June 30

July 31

0.71/512
Days

0.65/557
Days

0.52/705
Days

1.48

1.52

4.74

246 Days

240 Days

77 Days

6.The Alternatives &

Recommendations
What are the set of solutions?

The Alternatives
Revise customers credit policies
to speed up collection.
Make it easy for your customers
to pay you by offering all standard
payment options credit card,
cheque or direct deposit into your
bank account.
Recruit branch managers and
sales people to help in the
collection effort.
Discuss your terms with your
buyer at the time of sale.
Get extended credits from
suppliers.
Arrange short term borrowings.

THANK
YOU
Any Questions??