You may be vaguely familiar with the term ‘working capital’, but do you know what it truly means and why it’s important? Working capital refers to the difference between your current assets and current liabilities, or what your company owns minus what your company owes.
Working capital is an indicator of your company’s health and can affect funding, inventory, and long-term growth. It’s crucial to keep tabs on your company’s working capital to ensure you are maintaining company health and operational efficiency, as well as for determining whether you should expand or cut costs. For a complete guide to working capital, check out this infographic by JW Surety Bonds.
