Inventory refers to all the materials the company posses during different stages of the production. Inventory Types It is normally classified into three categories. Raw materials Work-in-progress Finished goods Raw materials refer to the initial basic products that are used to develop the end product. For a Steel company, the raw material is iron ore. […]Continue Reading... No Comments.
Working capital management refers to the decisions and managing the working capital (cash or cash equivalents, inventory, finished goods) efficiently during the normal course of business operation. This involves proper management of company’s total current assets and current liabilities. The main aim of Working capital management is to ensure that the company utilizes the working […]Continue Reading... No Comments.
To keep an eye on Working Capital Management we have to check following factors: Inventory Turnover Debtors and Creditors Turnover Working Capital Leverage Operating Cycle Cash Conversion Cycle Let’s discuss each and every factor in detail: Inventory Turnover Inventory can be in one of the following states: Raw Material Work in progress Finished Goods The […]Continue Reading... No Comments.
The Cash Conversion Cycle (CCC) measures time frame during which the company converts the cash from payables to receivables which means the time frame when the cash is inside the market place. During its daily business operations the company Buy the raw materials and inventories from the suppliers and pay them cash for the same. […]Continue Reading... No Comments.
Earlier the traditional supply chain model was based on a push based strategy where the manufacturers produced the goods and pushed them through the supply chain without receiving any proper feedback and information regarding any requirements or specifications. In that process, there was often some gaps between the supply and demand which led to either […]Continue Reading... No Comments.