Inventory/ AR / AP Mgt
(a.k.a. - "Working Capital Management")
What is it?
At its highest level managing a company is a game of choosing where to invest your chips. No, not stocks and bonds, but in daily activities like hiring, marketing, product development, and expansion. The more cash you have to invest in great ideas the faster you’ll grow your business. Maximizing your cash is all about strategically managing the elements that tie up and generate cash such as inventory, AR, and AP. The corporate world calls this Working Capital Management – what it means for you is freeing up the cash to take your business to the next level.
Why is it important for small businesses?
Small businesses are all about growth and cash is the growth’s fuel. Effective WC Management is absolutely critical to ensure that bloated inventory levels and overly generous payment terms don’t unnecessarily tie up cash that could be used to drive your business's growth.
How do you do it?
Effective WC Management requires two things – knowing what your various working capital levels should be and then monitoring them on an ongoing basis to make sure they remain at the optimal level.
What can 7L do?
We can perform a comprehensive analysis of your business’s working capital to understand what the ideal inventory, AP, and AR levels should be. Then we can build working capital reporting processes for you and teach you how to use them to monitor and manage your working capital levels.