November 2nd, 2023

Why Optimize your Cash Conversion Cycle?

06 December, 4pm

Optimizing your cash conversion cycle gives companies more options when seeking “enough” liquidity.

Basically, every company faces 2 options when seeking liquidity; they can “make it” or “buy it”. Ignoring liquidity needs is not an option.

  • Buy it – Aside from being expensive, access to it is uncontrollable. Besides, when your bank says “No”, the price becomes infinite.
  • Make it – by going beyond EBITDA as a measure of performance and focusing on the cash conversion cycle, companies become less dependent on the uncontrollable capital markets.

Bottom line all companies need a good plan well executed. Focusing purely on profits only gives a company a one dimensional view of performance.

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