How Siloed Manufacturing Decisions Drain Your Working Capital?
Mid-level operators and plant directors face a persistent paradox. Every department hits production targets and purchasing goals while overall cash flow remains tight. Traditional reporting metrics measure individual functions successfully. Purchasing secures volume discounts. Production maximizes equipment availability. Sales protects customer payment terms. Yet working capital balloons silently. Manufacturing turnaround consulting experts reveal that standard departmental choices interact to trap millions in idle inventory and delayed receivables. Why do departmental targets accidentally destroy enterprise liquidity? Purchasing buys raw materials in bulk to lower unit costs. The purchasing report shows a positive price variance. That early volume purchase immediately fills the warehouse with materials waiting for scheduled production. Inventory levels climb. Working capital stays locked in physical goods instead of funding core business operations. Production runs large batches to k...