₹42L demand dropped to nil
Case Study · Retail & Distribution · 38-day cash cycle reduction
Working-capital redesign releases ₹7.1 Cr of trapped cash
The business was profitable on paper and permanently short of cash. Receivables, inventory and vendor terms were redesigned as one cycle rather than three separate problems.
38 days
Cash conversion cycle reduction
₹7.1 Cr
Working capital released
-42%
Receivables over 90 days
13-week
Rolling cash forecast in place
The situation
- Collections were owned by sales with no ageing discipline or escalation ladder.
- Depot-level stock was ordered on habit, not on cover days.
- Vendor payments were released on invoice date irrespective of agreed terms.
What we did
- Introduced a weekly ageing review with named owners and an escalation ladder.
- Set cover-day norms by depot and SKU class, with exception reporting.
- Renegotiated terms with the top 20 vendors against actual purchase volume.
- Installed a 13-week rolling cash forecast reviewed every Monday.
Measured outcome
- Cash conversion cycle shortened by 38 days over three quarters.
- ₹7.1 crore released from the cycle and used to retire high-cost short-term debt.
- Receivables over 90 days fell 42 per cent without any change in credit policy.
Governance shift
Cash became a weekly governed metric with owners, not a month-end surprise for the promoter to fund.
Ready to put governance on a schedule?
Book a consultation or start with a free compliance health check for your business.