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YOUR TRUSTED PARTNER FOR COST-EFFECTIVE INVENTORY MANAGEMENT SOLUTIONS ON

YOUR TRUSTED PARTNER FOR COST-EFFECTIVE INVENTORY MANAGEMENT SOLUTIONS ON SLOW-MOVING OEM PARTS SINCE 1957. WHO IS SRS?. A COST-EFFECTIVE AND SEAMLESS SOLUTION  for YOUR slow moving inventory. For 5 decades, the leader in partnering with OEMs, Dealers and Distributors

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YOUR TRUSTED PARTNER FOR COST-EFFECTIVE INVENTORY MANAGEMENT SOLUTIONS ON

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  1. YOUR TRUSTED PARTNER FOR COST-EFFECTIVE INVENTORY MANAGEMENT SOLUTIONS ON SLOW-MOVING OEM PARTS SINCE 1957

  2. WHO IS SRS? A COST-EFFECTIVE AND SEAMLESS SOLUTION for YOUR slow moving inventory • For 5 decades, the leader in partnering with OEMs, Dealers and Distributors • Confidential and accurate inventory parts management with inventory reports and monitored access • Proprietary inventory system with over 40 million OEM parts in stock in 8 warehouses • Searchable parts portal with EDI compatibility and web ordering • Partnerships with over 100 market-leading OEMs ranging from heavy-duty to light industrial manufacturers

  3. OWNERSHIP AND AUDIT PARTNER FINANCIAL STABILITY AND QUALITY INITIATIVES Key Investors The following appears as a matter of record only $415,000,000 Trivest Fund IV, L.P. A partnership formed to invest in founder/family owned businesses Audit Partner

  4. OUR LONG-TERM RELATIONSHIPS PARTNERSHIPSWITH INDUSTRY-LEADING OEMS 30+ YEARS 20+ YEARS 10+ YEARS

  5. OTHER OEM PARTNERS

  6. CUSTOMER BUSINESS DRIVERS SRS is the BEST PRACTICE for SLOW-MOVING PARTS MANAGEMENT • bottom line profits • parts availability • customer loyalty • product lifecycle • customer retention • internal resources • inventory carrying costs • storage footprint • unprofitable inventory • customer fulfillment • inventory turn times • audit cycle counts

  7. OUR BUSINESS MODEL MAXIMIZING OUR PARTNERSHIP BY TAKING RESPONSIBILITY FOR YOUR SLOW-MOVING INVENTORY IDENTIFY RECEIVE AUDIT STORE FULFILL

  8. OUR BUSINESS MODEL IDENTIFY: Every quarter, OEMs identify their slow-moving, excess andobsolete parts to sell to SRS for the approximate scrap value, instead of scrapping. OEMs select parts with no sales activity in the last 12-18 months and go out of stock. OEMs can also consign parts to SRS that have had sales in the past 18 months. RECEIVE:SRS purchases or consigns this slow moving inventory consisting of service and production parts and finished goods that are then shipped to SRS. AUDIT: SRS audits, sorts, and enters the OEM part #, quantity, description, last sale date and last sale price into its custom warehouse management system. STORE:SRS stores its parts in one of its facilities until the OEM’s demand requires the part to be re-purchased. FULFILL:OEM is able to acquire parts from SRS with no minimum purchase amount and can even order through a confidential web-based parts portal and have shipments made directly to the OEM’s customer.

  9. OUR FULFILLMENT PROCESS WE PROMISE TO OPTIMIZE CUSTOMER SATISFACTION TRACK PICK INSPECT PACK SHIP

  10. OUR FULFILLMENT PROCESS WE PROMISE TO EXCEED YOUR EXPECTATIONS TRACK: OEM has the option to track the SRS inventory using its original part numbervia a proprietary web parts portal or they can receive inventory reports. PICK: SRS expert parts pickers accurately locate and pick the best quality part from one of our 8 warehouses. If there is a problem, the OEM is notified. INSPECT: SRS details and can even clean or paint the part if required using multiple methods including a gentle baking soda blasterwhich will not jeopardize the integrity or quality of the part. PACK: SRS packages all parts using shredded cardboard, anenvironmentally-friendly material, and becomes a seamless part of the OEM supply chain. SHIP: Next day air orders are shipped out the same day 98+% of the time to the OEM or directly to the OEM’s customer with satisfaction guaranteed.

  11. OUR VALUE PROPOSITION PROVIDING YOU A COST-EFFECTIVE AND SEAMLESS SUPPLY CHAIN OEM CUSTOMER BENEFITS • Access to new, authorized OEM quality parts for essential equipment • Shorten lead times for critical parts • Convenient same-day shipping service with no minimum orders • Eliminate need for unreliable and unauthorized or refurbished parts • Increase satisfaction and brand loyalty • Lengthen product lifecycles OEM BENEFITS • Receive immediate tax benefit and improve balance sheet • Free up valuable warehouse space • Maintain reliable parts supply for customers and dealers/distributors • Increase inventory turns and eliminate expensive carrying costs • Focus on core competencies • Earn income on subsequent sales

  12. OUR FINANCIAL VALUE PROPOSITION For EVERY $1,000,000 of INVENTORY, OEM SAVINGS total $769,188 over 10 YEARS OEM ASSUMPTIONS WHEN PARTNERING WITH SRS: • Inventory Cost = $1,000,000 • Inventory Value = $2,000,000 • Carrying Cost = 15% • Tax Rate = 40.0% • Cost of Financing (Discount Factor) = 5.0% • Parts Margin = 50% • % of Sale Price for Repurchases = 50% • % Expected to be Repurchased = 30% • Inventory Weight (LBs) = 100,000 • Scrap Value per LB = $.10

  13. OUR FINANCIAL VALUE PROPOSITION SRS SAVINGS to OEM at 15% ANNUAL CARRYING COST over a 10 year period

  14. ACCOUNTINGCONSIDERATIONS* The IRS will allow a deduction upon the sale of inventory as long as there are no limits on resale. The IRS will allow a deduction upon the sale of inventory as long as the company does not retain possession. The IRS will disallow a deduction upon the sale of inventory if the company requires payment when that inventory is sold to another party. SRS does not limit the resale of the inventory and maintains control at all time. SRS will pay the shipping expenses and obtains clean title to the inventory once the shipment arrives. SRS does not pay any commissions or offer any other incentives directly tied to the sale of any of its inventory. • * Inventory purchased from the OEM becomes the property of S.R. Sales and can be sold, scrapped, or altered at the discretion of SRS and for the sole benefit of SRS. Consult with your accounting and legal departments and other qualified authorities for a detailed analysis of appropriate IRS regulations and court decisions.

  15. The Knowledgeable Parts Experts YOU CAN TRUST with YOUR SLOW-MOVING PARTS S.R. SALES N31 W22300 Green Rd. | Waukesha, WI 53186 PHONE: 262-522-6644 | FAX: 262-522-7077 E-MAIL:SALES@SRSALES.COM JOHN STEINDORF, CEO CELL: 414-588-8031 E-MAIL: JOHN.STEINDORF@SRSALES.COM WEBSITE: SLOWMOVINGPARTSSOLUTIONS.COM

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