Minerco Inc (fka MINE)

[Sooah]

It's going to take at least a month or so for distribution at store level once he has the products in house. This is predicated on how they will go to market of course.

I am not understanding the basis for this comment, and I have read other comments about inventory holding.

I will share my thoughts on all the numbers (of days) being thrown around and what they signify. What's important to understand about "distribution" by Avanzar to individual stores and the amount of inventory holding level required is PRODUCT LEAD TIME. Based on the Company's updates, the lead time for this first run looks close to 60 days. Also, given that products are just going to market, there is no working demand forecast so the inventory holding level (what we call buffer stock) can be thought of as the equivalent of this first run. This is necessary to ensure there is no "stock out" issues to deal with during the initial launch.

This first batch of RISE/BOOST to Avanzar is most likely sold and as you have opined will be distributed to stores, however, it will not take a month to do this type of distribution as a milk run method will mostly be used. It will (and it has to) be done in batches so to be able to put together a demand forecast on a weekly basis and so on. Simultaneously, the Company should be able to shorten the lead time for future production as sales roll in and they are able to determine what is called an EOQ as well as a more accurate levels of safety stock based on actual demand.

Because we are the very beginning of product distribution, inventory holding can be much bigger, i.e. 60 days worth, however, the 60 days should not be understood as products sitting in the warehouse waiting for sales to occur or a holding period set by Avanzar Sales LLC because it just makes no sense for any party to incur this type of inventory holding cost--it's wasteful at many levels.

Inventory holding costs should be eliminated/lowered as soon as possible, and this is something that will happen once some of the "learning" involved with handling production/distribution is finished.

Hope this makes sense.

Best to all,
BB2