Surfing the Growth Wave

Social Share

Growth creates challenges and can increase risk. However, most of the “not all growth is good growth” discussion has to do with team readiness and/or production capacity.

However, the financial-specific dominoes associated with growth can be wild cards, especially when they represent uncharted waters.

For example, using debt for the first time as part of an expansion can add interest costs, amortization payments, and restrictions in how you use capital elsewhere (such as capex limits or distribution restrictions).

Another would be the impact to your working capital needs and cash conversion cycle – perhaps you have to buy materials/inventory earlier, bigger customers get longer payment terms, etc.

These are all manageable with the right tools and processes to provide the visibility to surf with confidence. The ability to credibly look forward is your surfboard.

Get Your Copy of Relational Finance – available in Hardcover, Kindle, and Audiobook formats – on Amazon