Abstract :

PT Gunung Raja Paksi faces significant challenges in maintaining profitability, which impacts its overall financial health. Key risk factors include the volatility of raw material prices, intense competition within the steel industry, and economic downturns. Fluctuations in raw material prices affect production costs and profit margins. Rising raw material costs can squeeze margins unless passed on to customers, which is challenging in a competitive market. The competitive landscape requires the company to balance competitive pricing with quality, leading to potential price wars and further margin erosion. Additionally, economic downturns reduce demand for steel products, impacting sales volumes and revenues. This study comprises four key components: risk assessment, Z-score model analysis, financial ratio analysis, and risk prevention formulation. The risk assessment, covering both internal and external factors, identifies major risks including supply chain disruptions, financing challenges, weather-related issues, major accidents, and steel market volatility. Analysis using the Z-score model, based on data from the past five years, reveals significant profitability risks for the company. Further examination of financial ratios shows that the company’s profitability ratios are generally below the industry average. Integrating these qualitative and quantitative findings indicates that the company should prioritize addressing supply chain disruption risks. Consequently, an early warning system has been developed, and risk prevention strategies have been established.

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Keywords :

early warning system, Risk Assessment., supply chain disruptions, Z-score model

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