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Working Capital: The £64 billion question

The Deloitte 2012 UK Working Capital Performance Study reveals that excess working capital held by UK plc has risen to £64 billion.

Recent Deloitte CFO Survey results have repeatedly highlighted ‘increasing cash flow’ and ‘reducing costs’ as top priorities for CFOs. Meanwhile CFOs expect to raise less external financing in 2012 than previous years. 

Therefore, the efficient use of resources, especially working capital, is front of mind for most CFOs. Despite this, the amount of underutilised, and therefore excess, working capital in UK plc is still rising. This represents a significant and growing opportunity for most companies to optimise their working capital performance.

The study examines the working capital performance of UK companies, identifies sector trends and compares the UK’s performance against Western Europe and North America. Key findings show that:

  • Excess working capital in UK plc rose to £64 billion in 2011.
  • UK businesses are putting increasing emphasis on payables management to balance performance.
  • Among UK businesses there is an increasing divergence between the best, average and worst performers.
  • The UK’s receivables performance is deteriorating compared to that of North America and Western Europe.
  • Structural and market conditions will continue to present challenges going forward.

Download Download the Deloitte 2012 Working Capital Performance Study (PDF, 1.11 MB)

Contact the team

Andrew Harris
Partner, Cash & Working Capital

David Lock
Senior Manager, Cash & Working Capital

Stephen Guerin
Manager, Cash & Working Capital

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