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The Value of Benchmarking Working Capital Efficiency – Crypto News

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That which can be measured can be improved.

The statement is often attributed to management consultant Peter Drucker. The right data, collected and analyzed at the right time, helps executives crystallize where they are, where they’ve been, and where they need to go when it comes to long-term strategy or when it comes to dealing with short-term, even immediate, challenges.

Visa is gearing up to offer executives a way to do just that, with a new calculator that helps executives benchmark their own firms’ metrics against peers in their geographies and industries, and by extension, chart a path toward greater success. The report and tool are powered by PYMNTS Intelligence using results from the 2024-2025 “Growth Corporates Working Capital Index,” which examined the working capital efficiency of 1,297 chief financial officers and treasurers across eight industries and five regions.

For all firms, having an optimal level of working capital on hand can mean the difference between success and failure. Working capital, as an accounting concept, is simple: assets minus liabilities. That gives executives the amount of liquid funding on hand to manage day-to-day operations.

However, managing working capital is as much art as science and goes beyond the static number derived from basic subtraction. External working capital solutions can be — and often should be — part of the proverbial toolkit that finance executives use to steer their firms through challenges and opportunities.

Growth Corporates Offer Examples of Optimization

Working capital optimization is especially critical for growth corporate firms with top lines of between $50 million and $1 billion. These are the companies that tend to be overlooked by traditional financial services providers, including banks, as they are too big for small- to medium-sized business (SMB)-focused solutions and too small for enterprise-level offerings.

As detailed in the 2024-2025 “Growth Corporates Working Capital Index,” there’s wider recognition that digital channels and solutions, such as virtual cards, can be tailored to fit the needs of specific firms in specific verticals. Efficient use of working capital can have a positive impact on everything from inventory to supply chain relationships — and the data shows that top performers can see a positive impact on their bottom lines to the tune of several million dollars.

We delved deep into what works (and what needs improvement), as more than 80% of Growth Corporates have used at least one working capital solution. The analysis of 23 countries offers a launching pad, so to speak, for something new.

Introducing the Working Capital Index Calculator and Dynamic Report

That something new is the Working Capital Index Calculator and Dynamic Report. The latter allows you to create your own report across a variety of parameters, such as the strategic/tactical use of working capital, the adoptions of various solutions and how one can stack their own performance against other Growth Corporates.

The Working Capital Index Calculator considers firm demographics and financial information and assigns a score that takes into account the specific industry and region. Call it a bit of shorthand, a way to sharpen one’s insight into the road ahead. After all, as the saying goes, what can be measured can be improved.

The highly anticipated interactive Working Capital Index report launches Feb. 20. Subscribe to the PYMNTS daily newsletter for exclusive access to this and hundreds of other research reports.

See More In: data, Featured News, Growth Corporates Working Capital Index, News, PYMNTS Intelligence, PYMNTS News, PYMNTS Study, pymnts tv, video, Visa, Visa Working Capital, working capital

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