How can small businesses effectively reduce their DWC days?

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  • #51240
    vtorosort
    Participant

    I’ve been struggling with cash flow in my little bakery lately. Last year, I expanded to add a small catering side, thinking it’d boost revenue, but it tied up more money in ingredients and unpaid invoices from clients who take forever to pay. Now my DWC is around 45 days, and it’s stressing me out. How can small businesses like mine effectively reduce those DWC days without cutting corners on quality?

    #51244
    ot11ss
    Participant

    Yeah, reducing DWC can make a huge difference in keeping things afloat. I own a graphic design studio, and a couple years back, we were at about 60 days because clients dragged their feet on payments while we had to pay freelancers upfront. We tightened up by negotiating better terms with suppliers—extending our payment windows from 30 to 45 days—and started offering small discounts for early client payments, like 2% off if they pay within 10 days. That shaved off about 15 days pretty quick. Also, we got stricter on inventory; instead of stocking up, we switched to just-in-time ordering for materials. It wasn’t overnight, but it freed up cash for growth. Here’s an article that shows how to calculate days of working capital that might help you crunch your numbers accurately and spot where to improve. Give those tweaks a shot; they’ve worked for us without any major overhauls.

    #51251
    augustusxgermanicus
    Participant

    I remember when I first started my online store selling handmade crafts, DWC wasn’t even on my radar until a mentor pointed it out. We were holding too much stock, waiting for sales, and it was eating into profits. To cut it down, I focused on streamlining operations: better forecasting demand using simple sales data from the past months, which helped avoid overbuying. Another thing was building stronger relationships with suppliers for flexible terms, and I even automated invoicing to chase payments faster. It’s all about balance—don’t rush into big changes, but small consistent steps add up. For anyone reading, track your metrics monthly; it keeps surprises at bay and lets you adjust on the fly. Overall, patience and data are key in this game.

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