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Hershey Foods and the Three Financial Drivers Shareholders of a company are most concerned with the price of their stock. If a stock price is high, the business should be doing very well, and subsequently, if the stock price drops, then the company is probably doing poorly. Stock price is derived from the three financial drivers. These financial drivers are related to a company’s operations. These three factors, in order of supply chain importance, are capital utilization, profitability, and growth. Capital utilization is the most important factor because it has the most potential for supply chain managers to improve the overall financial performance of a company. The utilization of fixed assets is very important for a supply chain manager. These assets are already a part of the company and need to be evaluated first. It is a waste of time to focus on new assets if the preexisting assets are not being used efficiently. Growth and profitability usually result if capital utilization is incorporated successfully. There are three areas in the supply chain that can be improved through capital/asset utilization. These three areas are warehouse management, production, and transportation and shipment. Warehouse management can be improved by increasing staff productivity and effectively using space.
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