Authors: Dr. Devaraj Kinslin, Dr. S. Edmund Christopher and Dr. Srinivasan Lakshmanan

ISBN: 978-81-973185-5-9

DOI: https://doi.org/10.59646/wcm/190

Date of Publication: May 21, 2024

About the Book:

The term “working capital” is often used to describe the money that a business needs to cover its immediate costs. The money that would normally go towards paying these bills becomes stuck in current assets, according to the finance manager. Net working capital (NWC), the difference between current assets and current liabilities, is the source of liquidity that he seeks. A lender considers the amount of the NWC as a measure of the business’s long-term commitment to supporting its existing assets. However, for a production manager, liquidity means that the material inputs to the manufacturing lines may be supplied continuously. Similarly, even while there is market demand, a marketing manager’s marketing sources will dry up if manufacturing is not happening. The production manager and the marketing manager are terrified about running out of stock, but the finance manager warns against overstocking. As a result of this disagreement, the organization’s mission often takes a second seat. Using a techno-financial framework for managing working capital, this book seeks to end these disagreements.