Global Manufacturing: $4.2M Working Capital Improvement
How comprehensive cash flow management and strategic financial controls helped a multi-location manufacturer reduce DSO by 35% and unlock millions in working capital across 12 facilities.
Executive Summary
Global Manufacturing Solutions, a diversified manufacturer with 12 locations across North America, partnered with Schapira CPAs to address critical cash flow challenges. Through comprehensive financial analysis, process optimization, and strategic controls implementation, we reduced their Days Sales Outstanding (DSO) by 35%, improved working capital by $4.2 million, and established sustainable cash flow management practices across all locations.
Client Profile
Global Manufacturing Solutions
Multi-Location Industrial Manufacturing
Company Details
Manufacturing Segments
- Industrial machinery components
- Automotive parts manufacturing
- Custom fabrication services
- Precision machining operations
Global Manufacturing Solutions has built a reputation as a reliable supplier to major industrial and automotive customers. However, rapid growth across multiple locations had created cash flow challenges, with inconsistent collection processes and limited visibility into working capital performance across their diverse operations.
The Challenge
Critical Cash Flow Constraints
Despite strong revenue growth and healthy margins, Global Manufacturing was experiencing severe cash flow pressures that threatened their ability to invest in growth opportunities and maintain operational flexibility across their expanding network.
Extended Collection Cycles
Average DSO of 68 days with some locations exceeding 85 days, creating significant cash flow gaps and limiting operational flexibility.
Inconsistent Processes
Each location operated with different credit policies, collection procedures, and financial controls, creating inefficiencies and compliance risks.
Limited Visibility
Lack of centralized reporting and real-time visibility into cash flow performance across locations, hindering strategic decision-making.
Working Capital Strain
Excessive inventory levels and poor receivables management tied up over $6M in working capital, limiting growth investments.
Our Comprehensive Solution
Strategic Cash Flow Optimization
Schapira CPAs implemented a comprehensive cash flow management program that standardized processes, improved visibility, and optimized working capital performance across all 12 locations.
Phase 1: Assessment & Analysis
Financial Performance Analysis
- Comprehensive cash flow analysis by location
- Working capital performance benchmarking
- DSO and collection efficiency evaluation
Process Documentation
- Current state process mapping
- Gap analysis and improvement opportunities
- Best practice identification across locations
Phase 2: Process Standardization & Controls
Credit Management
Standardized credit policies and approval processes
Collection Procedures
Automated collection workflows and escalation protocols
Centralized Reporting
Real-time dashboards and performance metrics
Phase 3: Technology Implementation & Training
System Integration
- Integrated ERP and financial reporting systems
- Automated invoicing and collection workflows
- Real-time cash flow monitoring tools
Team Development
- Comprehensive staff training programs
- Performance metrics and accountability systems
- Ongoing support and optimization
Outstanding Results
Transformational Cash Flow Improvement
The comprehensive cash flow optimization program delivered exceptional results, significantly improving working capital performance and establishing sustainable financial management practices across all locations.
Additional Business Impact
Operational Improvements
- Reduced bad debt expense by 60%
- Improved inventory turnover by 25%
- Streamlined month-end closing by 40%
Strategic Benefits
- Enhanced credit facility terms and capacity
- Improved supplier payment terms and discounts
- Enabled strategic growth investments
"The cash flow transformation Schapira CPAs delivered exceeded our expectations. Not only did we free up over $4 million in working capital, but we now have complete visibility and control over our financial performance across all locations. The standardized processes and real-time reporting have given us the confidence to pursue aggressive growth plans while maintaining strong cash flow discipline."
Key Takeaways
For Multi-Location Manufacturers
- Standardized processes drive consistent performance
- Real-time visibility enables proactive management
- Working capital optimization unlocks growth potential
Success Factors
- Comprehensive assessment and gap analysis
- Technology integration and automation
- Change management and team training
Project Summary
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