Map a Commercial Working Capital Cycle

Questions about working capital are clearer when the banker maps timing before discussing any product or credit request. Ask when the company buys inventory, when suppliers expect payment, when goods ship, and when customers actually pay. A revenue total alone does not show the gap between cash leaving the business and cash returning. The conversation should reveal the operating cycle without prescribing how the owner should run it.

Lumen Supply pays vendors within fifteen days, holds inventory for forty days, and collects from contractors sixty days after delivery. Its CFO says cash feels tight despite rising sales. The banker asks for a current aging report, inventory schedule, and monthly cash forecast. She does not state that growth causes the issue or that a financing solution will be available. She says the facts will help the proper team evaluate the request.

Look for changes in addition to averages. A new supplier term, delayed invoice approval, or larger order can alter the cycle even when annual revenue is stable. Invite the CFO to identify who owns each source record and to explain any event that occurred once. This makes a later review more accurate than a broad claim that the company needs more capital.

Finish with a shared timeline that identifies purchase, payment, shipment, invoice, and collection points. Record which figures are confirmed and which are forecasts supplied by the customer. The commercial banker can coordinate a follow-up with the right review contacts, but should not promise availability, pricing, or approval. The value lies in turning a vague statement about pressure on cash into a documented operating sequence that the customer and bank can discuss responsibly.