Working Capital Management

„Cash is king.“ 

The well-known term working capital is derived from the difference between current assets and current liabilities. With steadily increasing cost pressure, it is becoming increasingly difficult to achieve set return targets on capital employed.

Liquidity tied up in current assets is often noticeably lacking in the annual result and thus offers enormous potential for releasing capital.

According to estimates, the 1,000 leading European companies alone have a working capital potential of more than 500 billion euros, which is just waiting to be raised.

Best practice companies do not aim to have their entire business financed by their suppliers. Rather, the balance of receivables and payables with an optimal inventory level enables a smooth process based on partnership that optimizes the cash conversion cycle. A clear competitive advantage in increasingly globalized and complex markets.

 

Typical effects of a working capital optimization are:  

  • High releasable liquidity in receivables and portfolios
  • Significant reduction in payment terms
  • Optimized handling of payment processes (especially payables and receivables)
  • Increase in profitability
  • Release of capital for investments
  • Improvement of key performance indicators
  • Optimization of internal process flows
  • Identification of external factors that burden working capital
  • Identification of target/actual deviations in the working capital targets
  • Recognition of changes in different reporting segments (region, responsible person, market power, customer/supplier, etc.)
SELECTED PROJECT REFERENCES

Rail industry

Global working capital project with focus on receivables & liabilities
Key results:

  • 60 % reduction in working capital
  • 45 % reduction in overdue receivables
  • 20% increase in liabilities

Foodindustry

Global working capital project with focus on receivables & liabilities
Key results:

  • 37 % reduction in working capital
  • 56% reduction in overdue receivables
  • 15% increase in liabilities

Automotive suppliers

Working capital project with focus on inventory reduction
Key results:

  • 45 % reduction in working capital
  • 40% reduction in inventories

We are happy to support you in finding out which strategy is suitable for your business model and develop an efficient implementation concept together with you.   

Our approach:

In our Quick-Scan we analyze the status quo of the working capital in your company before it moves on to implementation.

 

The following points are typical starting points for optimizing the working capital of our customers:  

  • Liquidity bottlenecks and dependence on banks or capital providers
  • Pressure on margins due to intensified competition in globalized markets.
  • Insufficient cash flow in recent years.
  • Increasing default risk due to overdue receivables.
  • Lack of space due to high inventories without relation to delivery reliability.
  • Lack of capital for growth investments.

 

With our benchmark database, we can compare initial performance parameters and use them to define fields of action or measures.

The Quick Scan for Inventory Taking  

We analyze Quick-Scan possible potentials of your company, develop targets and an implementation roadmap together with you as the customer. For the transition phase, additional quick wins are identified.

 

The implementation  

The first step in the implementation of our result-oriented approach is to launch a pilot project. If the pilot test phases are positive, the working capital optimization measures will continue to be applied to the entire company.

This approach has proven its worth throughout the numerous working capital projects we have carried out. On the one hand, pilots allow us to identify and minimize risks that arise at an early stage and, on the other hand, we can then complete the main projects faster, more smoothly and with the desired result.

A competitive advantage, which in the end will bring your company further forward.

 

Range of services for your organisation:

Our range of services in the field of working capital at a glance:  

  • Together with you, we develop best-practice concepts for the rapid and sustainable reduction of working capital.
  • We analyse all the key parameters of working capital management and show how tied liquidity can be effectively and permanently released within a company.
  • We ensure the balance between receivables and payables while maintaining an optimal level of inventory.
  • With your team, we achieve quick wins in the shortest possible time through systematic processing.
  • We achieve sustainable results through structured and individual process adjustments.

Let us optimize your working capital management together. Contact us and benefit from the many years of experience of our employees in the field of working capital management.

Our solutions