In an economic environment under pressure, the ability to secure and circulate cash is a major challenge for all companies, whatever their size or sector. size or sector. The finance department is no longer simply the guardian of balance: it is at the heart of the decisions decisions that determine resilience and development.
Cash, a vital resource in the operating cycle
At every stage of its business, every company needs available liquidity to be able to operate: finance purchases, build up inventories, pay salaries and expenses, maintain production tools. This constant liquidity requirement is known as working capital working capital requirement (WCR).
Like any resource, cash has a cost. The challenge is to reduce WCR to the strict minimum without compromising operational fluidity. This requires rigorous processes - payment deadlines, invoicing, collection, inventory management - to accelerate to accelerate the flow of cash within the company.
Financing your needs intelligently
Despite optimized management, some needs cannot be covered by available cash. available. This is where our financing policy comes into play, enabling us to supplement internal resources with solutions adapted to the nature and timeframe of the needs.
An effective financing strategy rests on three pillars:
1. Aligning financing needs and horizons
Investment, external growth or transformation require long-term financing. financing. Needs linked to day-to-day operations (peaks in activity, payment timing differences) call for short-term solutions. Structuring your liabilities according to these principles enables you to secure liquidity without unbalancing the financial structure.
2. Diversifying sources
Factoring, leasing, inventory financing, reverse factoring, bank loans or private issues... options offers greater flexibility and limits dependence on a single financial partner. single financial partner. This agility is key, especially in times of tightening credit conditions. credit conditions.
3. Integration into overall cash management
Le financement ne peut être pensé isolément. Il doit être étroitement lié à la prévision de trésorerie et à la gestion du BFR, pour garantir une vision consolidée, dynamique et cohérente de la liquidité à court et moyen terme.
Towards modern liquidity management tools
Even today, the majority of small businesses continue to produce their cash flow forecasts manually. This lack of automation can lead to significant financial losses losses: failure to optimize investments, unanticipated recourse to costly financing even avoidable overdraft charges. A recent study (Agicap, 2024) estimates these 450,000 per year on average for a medium-sized company.
Automating the forecasting process and making it more reliable is therefore becoming a strategic priority, with several key challenges:
- Improved reliability and responsiveness, thanks to ERP/EPM connections, automatic and structured reporting.
- Deepen your analysis, thanks to the computing power that enables you to better understand cash flow variations, in particular the components of WCR.
- Boost management dialogue, thanks to visual interfaces that make it easier to read, communication and decision-making.
Last but not least, quality forecasting presupposes a well-defined organization: an appropriate tool, harmonized processes, rigorous monitoring and, above all, committed, trained and committed teams. processes, rigorous monitoring and, above all, committed, well-trained teams aligned aligned with a common cash culture.
A process adapted to the company, not the other way around
The implementation of an effective liquidity forecasting and management system cannot be standardized. be standardized. It must be tailored to the specific challenges of each organization. This is why recommended to start with a strategic framing phase, followed by a pilot, enabling pilot phase, enabling all stakeholders to be progressively tested, adjusted and involved. stakeholders.
This step-by-step approach fosters ownership of the process, helps teams gain and ensures a successful transition to a more robust, precise and strategic management model.
At Mentorium Partners, we believe that liquidity management is more than just balancing a cash flow statement. balancing a cash flow statement. It's about building an intelligent, dynamic, performance-oriented architecture performance-oriented architecture - for a company that's more autonomous, more agile and more confident in its choices.
