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Inés T avatar image
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Inés T asked Braydn T answered

Perform an investment analysis on FlexSim

Hello,

I would like to know if anyone has information on how to perform investment analysis on FlexSim.

Thanks.

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Benjamin W2 avatar image Benjamin W2 commented ·

Hi @Inés T,

There are many ways to use FlexSim to perform investment analysis. In fact, you might say that investment analysis is one of FlexSim's primary purposes. However, without more information about your model or process, it would be difficult to describe how it can help you.

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Inés T avatar image Inés T Benjamin W2 commented ·

Hi @Benjamin W2,

I would like to know if it is possible to o apply investment analysis methods such as the calculation of cash flow and net present value (NPV) in FlexSim.

Thanks.

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Braydn T avatar image
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Braydn T answered

FlexSim can help to do investment analysis, including the methods you mentioned, but it does not do investment analysis calculations for you.

For example, the only variable FlexSim could help you obtain in the calculation of NPV is the amount of cash flow you could expect to obtain from the purchase of a new piece of equipment or the addition of a new employee on your line. The way this would be done is you would model your system as it currently exists, and set it up to provide valuable information like throughput.Then you would add the piece of equipment to your model, and track the changes in those numbers.

If you are anticipating adding a machine will increase the number of a certain part made within a certain time period, and thus result in an increase in parts sold with in that time period, you can determine with FlexSim how man more of that part could be made in a month. Obviously FlexSim can't account for things like number of sales made or demand, but it can help you figure out if adding a machine or employee could help increase the productivity of your system.

You could create a dashboard in FlexSim with some custom code that returns a NPV value based on the output of the model, but that is not something that comes built in, largely because expected cash flow from an investment is just one of the variables required in calculation of NPV.

I hope this helps to answer your question. Feel free to leave a reply if you would like more information.

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