Working capital is a vital concept for business owners to understand. Our friends at Inform Consulting Group recently stated the reasons for this in very clear terms:
“Working Capital is a notion that business owners and managers need to come to grips with and manage effectively in order to ensure sustainability.
Maintaining healthy working capital provides a safety net to absorb possible bad debts, for example, and may be critical if you need to apply for a business loan. It is also critical for maintaining operations if you receive an unusually large order from a client.”