Cash Flow Strategies for Business Liquidity: A Financial Health Imperative
Cash FLOW remains the lifeblood of any enterprise, dictating liquidity and operational viability. A misalignment between receivables and payables—measured by the Cash Conversion Cycle (CCC)—can strangle growth and stability. Businesses must bridge these gaps to meet obligations like payroll, supplier payments, and debt servicing.
The CCC formula quantifies the risk: Days receivables plus days inventory, minus days payables, equals the cash Flow gap. Prolonged gaps demand strategic intervention—whether through inventory management, receivables acceleration, or payables optimization. The stakes are clear: liquidity shortfalls threaten survival, while optimized flows fuel expansion.