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Perspectives

Unlocking capital freedom: Mastering working capital performance in a post-pandemic world

Deciphering the keys to corporate resilience and liquidity amid global economic uncertainties

The business landscape changed after the global pandemic resulting a new era of challenges and opportunities. Our 2023 report provides an in-depth analysis of the financial performance and stability of corporations in this rapidly changing environment, touching on a range of factors from rising interest rates and volatile commodity prices to escalating labor costs and growing geopolitical tensions. Explore our Working Capital Roundup 2023 report to learn how you can anticipate and address these liquidity challenges.

Following two years of remarkable prosperity, with revenue growth surging to 22.2% in 2021 and 13.3% in 2022, our analysis reveals a significant deceleration to 1.6% in 2023. We delve into the complexities of this trend across various industries. The energy, resources, and industrials industry bucked the revenue growth trend with a decrease of 5.4%, primarily driven by a significant fall in the energy and chemicals sector. On the brighter side, the consumer and technology, media, and telecommunications industries managed to convert enhanced revenues and margins into boosted net incomes. Despite these gains, our report reveals the increasing financial strain on corporations, evidenced by rising net debt and challenges in managing operational cash flow. This comprehensive look at working capital performance exposes a year-on-year deterioration, underscoring the intricate dynamics of today's corporate financial landscape.

In our Working Capital Roundup 2023 report, we share the leading trends and key drivers affecting working capital performance across industries. Additionally, our report provides industry-specific use cases of how Generative AI can be used to improve efficiencies. Explore our report to see how you can enhance liquidity performance and capture new sources of value.

Download Working Capital Roundup Capital Freedom: Exploration of 2023 working capital trends

 

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The next steps

The right people, processes, and systems can create a culture that improves WC performance and frees up capital. That freed-up capital can then be used to lower debt and invest in the business. And this flexibility can lead to greater returns and sustained performance in the future. Leaders must put in place proactive measures that build a cash-conscious culture, where an employee is empowered to assess every decision through a liquidity lens.

We can help you thrive

Disruption is inevitable. But companies have options. They can either be at its mercy or become disruptors themselves—but only the latter will thrive. To optimize working capital performance, companies need a tailored and structured approach. With our leading-edge technologies, insights, and experience, we help clients design a robust cash governance framework and move toward becoming an outcomes-driven organization.

Learn how to valuate and improve your working capital.

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Enhanced cash flow forecasting and working capital

A more efficient and agile approach to cash flow forecasting

Optimizing working capital to strengthen cash positions

Tapping into the least expensive investment capital available