Working Capital Management

Working Capital Management

By improving the performance of working capital and optimizing the financial supply chain, corporate treasury can unlock value throughout your organization which can be used to fund value-creating opportunities and improve business performance.

Although working capital is important to every organization, it is often under-managed and lacking in visibility. In collaboration with procurement and the credit department, corporate treasury can help to reduce the cash conversion cycle (CCC), which is the time that cash is tied up in operations and unavailable for other activities.

Trends & Developments

  • Via optimized payment term policies the order-to-cash (O2C) and purchase-to-pay (P2P) processes are ensuring a minimal burden on working capital;
  • Corporate treasury can help to assess the impact of optimizing vendor payment terms (days payables outstanding – DPO) and customer payment terms (days sales outstanding – DSO);
  • Because of its expertise in financial risk management, corporate treasury is often asked to add value by helping to assess the implied risk in commercial transactions;
  • Concepts such as factoring and reverse factoring are used to minimize working capital and optimize cash management.

How can we assist you?

  • Corporate treasury can help the accounts payable (AP) and accounts receivable (AR) departments to reduce the cash conversion cycle (CCC), freeing up valuable working capital;
  • Besides optimizing the financial supply chain Zanders can also help to answer the more fundamental questions as to why, when and where your global organization needs the cash;
  • Treasury can bring its expertise in financial risk management to the table in helping to assess the implied risk in commercial transactions. For this Zanders has developed a tool that calculates the Risk Adjusted Return on Sales (RAROS).

Interested in working capital management?

Laurens TijdhofSander van Tol
Get in touch with Laurens Tijdhof or Sander van Tol for more information about working capital management.