LearningCat: Working Capital Management
Quick Ratio
Quick ratio is the financial measure that helps in identifying how well it is performing by the capacity of paying its current debts. It aids in spotting the ability of the company to complete short-term liabilities with liquid assets. What is Quick Ratio? The quick ratio can be described as the financial ratio that shows […]
Optimizing Accounts Receivable in Working Capital Management
To run the business seamlessly, cash is the first and foremost requirement, and managing accounts receivable is an integral part of the cash flow. In case the customers owe money to the company but they are not paying on time, then problems can occur. The company can have plenty of invoices that are not yet […]
Operating Cycle of Working Capital
The operating cycle is a crucial part of understanding how a business works, especially when it comes to managing cash flow. It’s about the time a company takes to turn its investments in inventory into cash. In simple terms, it’s how long it takes for a company to buy inventory, sell it, and then get […]
How to boost Working Capital through Accounts Payable
The market kept changing because of different trends that came time to time. Nevertheless, money always stays constant in any business. It is vital to improve working capital for businesses to be consistent in their operations. Accounts payable plays a great rule for making improving working capital more pivotal. Accounts payable are often viewed as […]
Efficient Inventory Management
What is inventory management? Inventory management is the way for efficiently tracking, systemizing, and directing the stock of goods of the company. It includes managing inventory efficiency, reducing costs, and ensuring on-time availability to meet the demands of customers, which results in increasing the profitability and satisfaction of the customers. Why inventory management is required? […]
Current Ratio
Current ratio comes under as one of the types of liquidity ratio. It is considered one of the essential financial measures and also empowers businesses as well as stockholders to form a reasonable judgment with respect to investments. This guide will assist you in broadening your perspective about the ease of this particular liquidity ratio […]
Cash Conversion Cycle (CCC)
The Cash Conversion Cycle (CCC) is a crucial measure of how fast a business can turn its investments in inventory and receivables into cash. It tells you how quickly your business can move from spending money on raw materials to collecting payments from customers. Think of it as a race: the faster you can convert […]
Case Study: Working Capital Management for Tata Motors’ Launch of the Nano (2008)
In the year 2008, Tata Motors launched the budget-friendly car “Tata Nano,” which became the world’s cheapest car. The goal is to provide the cars to the Indian families, mainly the lower-middle class, the more affordable with safer alternatives as compared to two-wheelers. At first, it is launched at a price of around ₹1 lakh […]
Case Study: Working Capital Management Amid the 2023 EV Investment Surge
The year 2023 was a complicated ride for the electric vehicle (EV) market. Governments provided significant subsidies for EV manufacture, and consumer demand skyrocketed. EV sales soared, but with them came significant hurdles. Automakers were struggling not just to satisfy demand, but also to manage working capital, which is the cash required to conduct day-to-day […]
Bank Overdraft Facility for Working Capital Finance
Running a business means keeping track of various financial numbers to stay stable and avoid chaos. One of the key things to manage is accounts receivable, especially for businesses offering credit to clients. This is where the Accounts Receivable (AR) Aging Report steps in, acting like a financial watchdog to keep your cash flow in […]
Working Capital Turnover Ratio
As an entrepreneur, it is required to be updated for the company’s working capital turnover ratio. If it is not analyzed properly on a regular basis, then that may cause disruptions in the cash flow for daily operations. By examining this financial measure, it gets easy to decrease the production blockage and keep the business […]
Working Capital Loans in India
Running a business is not all about generating profits. To maintain business continuity, an adequate amount of cash is required. Tasks like paying salaries, purchasing stocks, and managing bills—every single business requires constant cash flow. But the question arises: what happens when the business runs out of cash? Working capital loans are relevant in this […]
Trade Credit in India
In the changing world of business, managing cash flow efficiently becomes one of the primary challenges that a company can face. From small companies to large ones, businesses are required to maintain equilibrium between tasks like purchasing materials, maintaining enough stocks, and maintaining liquidity for daily operations. Trade credit has been instrumental in achieving this […]
Short term financing
In India, MSMEs are at pace. But this pace requires various choices of financial acquisition in order to face numerous challenges that will occur for sure. Sometimes immediate finances are required, so in that case, short-term finances are the option to rely upon. This guide will provide you the information to understand the various short-term […]
What is Working Capital? – Formula, Importance and Advantages
Working capital is considered one of the vital aspects that ensures the smooth activity of businesses related to any field. It is advisable to use working capital as a financial instrument to get a fair sense of the business for short-term financial stability. Working capital is simply the amount of liquidity that a business has […]