This is a model that simulates the cash flow of a factory producing widgets. The factory uses a production system that is nearing the end of its useful life. This model evaluates two scenarios: 1. Full replacement of the production system and 2. Refurbishment of the system. Both options have different upfront capital costs and on-going maintenance costs. Using GoldSim's scenario management capability, you can evaluate the difference in cash flow while considering the cost implications of both alternatives.
In this model, we simulate the production, repair and cash flow from a production line. At the start of the simulation, a Discrete Change element representing the cost of refurbishment or replacement is triggered and sent to the Cash Flow element.
When operating, the line produces at capacity until the warehouse fills (which occurs when the Widget_Production Reservoir reaches its cap of 250). The line is represented with a Function reliability element, which fails on average every 20 days if refurbished and every 60 days if replaced. It takes an average of 7 days to repair. Whenever the reliability element stops operating due to failure, production stops and a Discrete Change element representing the cost of spare parts is triggered and passed through to the Cash Flow element. The spare parts costs vary depending on the scenario.
Demand (from the History Generator in the main level of the model) draws down the Widget_Production reservoir. This outflow is multiplied by the value added per widget and used as a Revenues input in the Cash Flow element.
To Open the Model File:
- Start GoldSim
- Click on the File and select Open Example...
- Browse to General Examples --> Financial Examples
- Select the file called CashFlowAlternatives.gsm