UK manufacturers could be missing out on the chance to unlock finance from their business due to untapped cash release opportunities, accountancy firm RSM has warned.
Improving working capital practices in the UK manufacturing sector could generate a cash injection of up to 6 per cent of turnover, according to the latest RSM working capital survey. For the sample data used, this equates to about £400m, highlighting a "significant opportunity" for UK manufacturers.
The firm said introducing key improvements to reduce working capital through new or modified processes and compliance would help to generate cost savings, particularly transactional and operational.
The survey analysed a range of working capital metrics from 75 UK-based manufacturing companies and reaffirmed previous findings that inventory is the key driver of working capital.
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