Wrap Up Session in Krakow.

Can Pack Inc.

They only had 60 people at the plant while making 3,000,000 cans per day at the one plant in Krakow which is pretty remarkable with only 14 in the factory. Products are a great indicator for where they company is going in terms of their aluminum, glass, and steel demands for their products. Out sourcing and transportation is a big part of their company as well. They want to see the flow of their production from begging to end. They have specific service specs that they need to keep track of with no damage to the cans, travel time and cost while delivering these cans. They have very high vertical integration with in the company with large and few customers which keeps advertising costs down real low. This makes not as much credit risk at all as well with big names such as Coke, Pepsi, Heineken. They have a ten hour lithograph process with 3% waste in the factory and almost 0% faulty products when they are shipped out which is extremely high quality. There costs seem a little high with 9 cents per can. It takes about $75 million to start a new plant. Out sourcing is about 5-7% of costs.

Inventory is only there 2 days after sale.
Accounts receivables are 30 days.

Interesting process to note that the financial sector uses.

Sales
-COGS
-SADA (Selling, Advertising, Distribution, Administrative costs)
= PBIT (Profit Before Tax)
-interest
=EBIT (Equity Before Tax)
-Tax
=NI

NI
+DEP
+/- Change in NWC
=Operating Cash Flow
+/- Investment

NWC (Net Working Capital) = INV + A/R - A/P

This Finance company is funded with corporate bonds and bank loans so they need the amount of money they need for leverage with the right interest rate.

They hedge for Aluminum prices for 2 years out.

Richard Lucas

Some interesting things to note were emotional v.s. intellectual I.Q.
Business is generic.
Good listening while managing.
P's of Product, People, Process and Profit.
C's of Customer, Competition, Cost and Capital.

The importance of highering and keeping good people that created value to the firm.
Hard to separate family and work as the C.E.O. so he rather be the consultant for 5 companies.