By properly managing cash flow and liquidity, businesses can brace themselves for the impacts of the COVID-19 pandemic.
For many manufacturers, cash flow is the limiting factor that determines how many new business opportunities they are able to pursue, and how ambitious their strategy can be as they plan for the future. The demands of Industry 4.0 require data-driven management both inside and outside the factory, requiring continuous capital investment to keep pace with a fast-moving business environment. Pricing pressures add to the challenge, reducing margins even as customer demands increase ever more quickly. Even the most forward-thinking manufacturers will have trouble staying ahead of the curve if they cannot access enough internal cash flow to keep the wheels of innovation turning.
Across all industries, effective management of the entire end-to-end value chain can drive significant improvements both in terms of cash flow as well as profits. For retailers, however, the optimal strategy can be even more tightly focused, as cash and profits go hand in hand. The faster stock can be turned, the more profit and cash can be generated. Even so, the aim should not just be about turning stock quickly, but rather about turning the right stock quickly – and knowing how to align the speed of your supply chain to ever changing customer demands.
APAC remains the most dynamic region in the world in 2018. Expected to grow by 5.5% this year, the region is set to account for almost two-thirds of global growth, with strong GDP projections of 5.6% continuing into 2019. Grant Thornton’s International Business Report (IBR) also signifies sustained business leader optimism in the region. Net optimism sits at net 55% in Q2 2018, up 27pp from Q2 2017. ASEAN (the Association of Southeast Asian Nations) is a particularly bright spot. At net 64%, business optimism in ASEAN has reached a record high against healthy projected growth of more than 5% each year between now and 2022.
Keeping pace with a fast-moving economy means continually re-investing profits to fund future growth. Although many companies struggle to access the liquidity needed to enable timely investment, a proactive approach to working capital management can free up significant untapped cash within any business, providing a platform for longer term, sustainable growth.
In Part 1 of this article, we examined the importance of speed, flexibility, and successful adaptation in the current business climate.
In the natural world, the big winners are not always the strongest or fastest, but rather the ones that are best at adapting to changes in their environment. The business world follows similar rules – and its current environment is changing more rapidly than at any time in history, thanks to the digital revolution.
Effective cash management is a critical success factor for any business. To fund growth, invest in new infrastructure or mitigate short term downturns, having strong visibility and control of day-to-day cash is a must.
For the average large Thai organisation included in the study, just $0.7 million was lost through the direct result of attacks. Indirect effects accounted for $6.7 million of the lost money, while induced losses accounted for the remaining $5.3 million.
With the recent closures of Toys “R” Us (U.S.), Maplin and Topshop Australia, we investigate whether the internet is killing off physical stores and offer practical advice to dynamic retail businesses on how to avoid going under.
The vision for Thailand 4.0 is certainly ambitious, and is extremely well adapted to the digital economic stage that the world is now entering. But is that vision also well adapted to Thailand itself? Can this moderately advanced Southeast Asian nation handle the weight of its own development plan?
Much has been made of the Thai government’s commitment to developing a modern industrial base. In large part, the praise from the business community has been deserved. Concerted efforts include a range of initiatives, from a detailed program of BOI incentives, to the fast-tracking of business permits across industries, to the ambitious upgrades in infrastructure and government support that are making the Eastern Economic Corridor a highly promising region for manufacturing.
Optimising working capital requirements is key to assessing the efficiency of profits, and something CFOs are expected to manage at all times. Do you know how well working capital is managed in your business and where improvements could be made?
China’s One Belt, One Road outbound investment strategy presents a wealth of opportunity along major global land and maritime trade routes. But how can business owners outside China take advantage?
After deciding on a vision, there are two main barriers that generally prevent companies from following through on their initial ideas: Money, and expertise.
The reluctance is understandable. Your business has showed good signs of health for years (or decades), in large part because you’ve concentrated on creating value in the field you know best. Within a short span of time, you’ve begun to hear plenty of talk about the need for businesses to transform themselves for entry into the digital world.