Winning In A Downturn: Managing Working Capital

Date Added: Aug 2009
Format: PDF

Working capital is an important source of cash throughout the business cycle, but it is especially critical during a downturn. In periods of economic expansion, managers often focus so intently on revenue and earnings growth that they ignore other, less obvious methods of value creation, such as working-capital management - the process of optimizing net current assets relative to business volume. But companies that manage their working capital effectively can generate cash, streamline their operations, and improve their cost position.