Working capital is an important part of the daily operations of a company. We know that every company require funds ready in a liquid form to pay for the daily needs of the business. This is directly related to the well being of the company and plays a vital role in the success of the business. The working capital cycle is the time that is taken by a company to convert the current assets and liabilities into cash. This cycle also decides the fortune of the company. This cycle depends on various factors.


The company at the initial stage have longer WCC and becomes shorter as per the increase in proficiency of the company.

Factors Affecting the WCC of a Company

  • Stage of development of the business
  • Expansion of the business
  • Growth opportunities and the form of stocking inventory, spending, market research and product development

WCC Management

No matter what is the size of the business, profit, stage of development, sustainability and profitability, it is necessary to know all about the WCC management. Here are ways that help to shorten the Working capital cycle and increase the immediate liquidity.

  • Seek for the possible early payments from the products delivered to the vendors and distributors
  • Accurate inventory management where it is necessary to have sufficient stocks in inventory, neither too little not too much
  • It is best to offer the cash deals as it brings in cash in all the transactions. It is best to influence customers to purchase products with cash and enhance the WCC