Working capital that outgrew sales

An established Turkish FMCG producer, a broad portfolio across categories with nationwide production and distribution, watched its working capital climb faster than its sales. Cash was being tied up quicker than revenue was coming in. Management could see the number rising; what they could not see was what was driving it.

Working capital is the sum of many small decisions across receivables, inventory, and payables, each owned by a different function, none of them obviously wrong. The obvious fix, cutting inventory, would have cost service and sales. The real task was finding which specific decisions were quietly trapping the cash.

DA ran a data-driven review of the cash-to-cash cycle. Hypotheses across receivables, payables, and inventory were tested against the financials and operations, with targeted workshops, industry benchmarks, and stakeholder interviews. The detail mattered: lead times, service levels, demand-forecast accuracy, and SKU clustering simulations to see how the portfolio actually behaved.

The answer was not one move but several, each calibrated not to cost a sale. Service levels were matched to each product group instead of one blanket standard, lead-time variability was pulled down, demand forecasting was sharpened through SKU clustering, the portfolio was simplified, and the distribution network was reorganised. Working capital fell 9%, with profitability, service levels, and commercial performance held intact.