Working Capital Optimization

In view of extensive transformation processes and a volatile market environment, companies need appropriate financial leeway. Systematic working capital optimization is a key instrument for this.

Overview

Liquidity management has changed in recent years: Under the catchphrase "cash excellence", all relevant processes are being looked at and optimized at the appropriate points in a data-driven manner using digital tools. In this way, freed-up capital enables investments in growth as well as stabilization in phases of economic weakness.

In addition, working capital optimization ensures that companies with improved liquidity are better prepared for acute crises. Bottlenecks can thus be prevented in good time and companies can stay on course.

Services

All-encompassing optimization

Questions for our team

What are the main areas of application of working capital optimization?

Basically, it is about improving the liquidity and creditworthiness of companies by reducing the amount of capital tied up. In addition, a holistic process analysis usually also holds potential for increasing earnings. For many companies, this approach is also suitable for securing internal financing for transformation projects. Especially when access to capital markets and financiers is limited, working capital optimization is an alternative option. Private equity-held companies regularly use working capital optimization as an important lever in the value creation process.

How does FTI-Andersch deal with any conflicts of objectives?

To avoid conflicts – for example between costs, quality, and flexibility – we always analyze the planned measures holistically and work out existing interdependencies in detail. For example, in the case of cost-related supplier changes, we also keep an eye on individual product quality and delivery performance. Another example is the impact of inventory reductions: A possible shortage of production equipment must not jeopardize process stability. We are not only concerned with short-term optimization, but particularly with sustainable improvements without a “yo-yo effect”.

What are the advantages of external support in working capital optimization and how quickly do successes become visible?

We are not involved in day-to-day business and can therefore focus on analyses as well as the definition and implementation of measures. In addition, we have the necessary background with many years of experience and, in the case of complex projects, access to appropriate know-how and suitable tools. Another aspect is that we ensure knowledge transfer within the company so that the measures are effective in the long term. In terms of success, we are talking about just a few weeks, for example, when optimizing inventories of raw materials and supplies. The same applies to renegotiating payment terms or introducing factoring.

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