Why Manage Working Capital?
Working capital management helps a business make better use of its resources, which can improve its cash flow management and profits. To handle working capital, you need to keep track of your inventory and your accounts payable and receivable. The timing of accounts due (paying suppliers) is also part of managing working capital. A business can save money by paying its providers over a longer period of time and making the most of available credit, or it can spend money by buying things with cash. Both of these options affect how the business manages its working capital.