Working capital optimization can significantly improve cash flow and business efficiency. Fractional CFOs can deliver immediate value by implementing strategies that free up cash and improve operational performance.
Accounts Receivable Management
Implement credit policies that balance sales growth with collection risk. Use automated invoicing and follow-up systems to accelerate collections and reduce bad debt.
Inventory Optimization
Analyze inventory turnover by product category and implement just-in-time ordering where appropriate. Use ABC analysis to focus management attention on high-value items.
Accounts Payable Strategy
Optimize payment timing to preserve cash while maintaining vendor relationships. Negotiate extended payment terms and take advantage of early payment discounts when beneficial.
Cash Conversion Cycle
Calculate and monitor the cash conversion cycle to understand how quickly the business converts investments into cash. Focus improvement efforts on the most impactful components.
Supply Chain Finance
Explore supply chain financing options that can extend payment terms without damaging vendor relationships. These programs can significantly improve working capital efficiency.
Systematic working capital optimization generates sustainable cash flow improvements and operational efficiencies.
