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As such, it carries great value to those who might be interested in investing in your business or even purchasing it. However, this is very rare for a new business. Be careful about large volume customers or the reverse of speedy debt collecting could happen.

By offering incentives to speed up the production process or rewards for more timely customer payments, you will be more effectively managing and increasing your working capital. On the other hand, cutting yourself too short could be potentially harmful to your business.

There are a few instances in which having a poor or negative working capital is not necessarily a precursor to financial problems. For new businesses or those about to launch, working capital has a slightly different meaning.

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