Working Capital Optimization
Working capital is exactly where supply chain and finance meet. Every extra day in the inventory or receivables cycle reduces the organization's real cash on hand.
What We See
Inventory and finance optimize against two different metrics
The inventory planning team decides based on customer service level, finance based on cash — without a shared meeting point, each pushes against the other.
Supplier payment terms were never negotiated strategically
Current payment terms are usually a legacy of old contracts, not the result of a deliberate analysis of which terms are optimal for the organization's cash cycle.
The cash conversion cycle has never been tracked as a single metric
Days inventory outstanding, days sales outstanding, and days payable outstanding are each tracked separately — without seeing the full picture of their combined effect on cash.
Dead capital is hidden in Class C inventory
Because management attention usually focuses on high-value (Class A) items, a large amount of dead capital sits unnoticed in the low-value but high-count Class C items.
Our Approach (The DDIT Framework)
Diagnose
Calculating the current cash conversion cycle (DIO + DSO − DPO) and breaking it into components to identify whether the biggest cash-release opportunity sits in inventory, receivables, or payment terms.
Design
Designing a targeted inventory policy to cut dead capital (without hurting service level) and a payment-term negotiation strategy with key suppliers, coordinated with finance.
Implement
Rolling out changes across the identified highest-opportunity product categories or suppliers, and monitoring the effect on the cash conversion cycle weekly.
Transfer Capability
Designing a shared supply chain-finance dashboard for ongoing cash conversion cycle monitoring, and training both teams to have a shared conversation around that same metric.
Deliverables
- Cash conversion cycle calculation and breakdown (DIO, DSO, DPO)
- Targeted inventory policy to reduce dead capital
- Payment-term negotiation strategy with key suppliers
- Identification of hidden dead capital in Class C items
- Shared supply chain-finance dashboard
- Cash-release opportunity report by product category
Engagement Models
Diagnostic Sprint
Calculating the current cash conversion cycle and identifying the three main cash-release opportunities, in two weeks.
Full Transformation
A full redesign of inventory policy, payment terms, and receivables collection process.
Ongoing Advisory
Quarterly review of the cash conversion cycle in a joint supply chain-finance session.
Who This Is For
For companies under cash pressure, organizations with high inventory relative to sales turnover, or fast-growing businesses where working capital has become the main constraint on further growth.
Working capital optimization is where Sina Alipoor's inventory-planning and procurement experience directly meets a financial lens — a combination fewer technical supply chain consultants bring together.
Frequently Asked Questions
The total number of days it takes for money invested in inventory to come back as cash from customers, minus the days the organization has before paying its suppliers. A smaller number means less cash is locked up.
If done without differentiation, yes. That's why this project uses ABC-XYZ classification to target the reduction precisely at low-risk, dead-stock items, not critical, high-demand ones.
If it's part of a balanced negotiation (not a one-sided demand), no. Better payment terms are usually negotiated in exchange for a long-term volume commitment or multi-year contract — something valuable to both sides.
A lot — this project is inherently cross-functional. Without finance's active participation in setting goals and reviewing the shared dashboard, results don't stay durable.
Inventory-related changes usually show up within one or two sales cycles; supplier payment-term changes depend on contract renewal timing and can move more slowly.
Ready to talk about this domain?
Tell us about your organization's specific challenge, and we'll recommend the right engagement model.