{"id":22988,"date":"2025-03-20T14:28:46","date_gmt":"2025-03-20T14:28:46","guid":{"rendered":"https:\/\/www.simplybusiness.co.uk\/?post_type=knowledge&#038;p=22988"},"modified":"2025-05-22T13:03:12","modified_gmt":"2025-05-22T13:03:12","slug":"what-is-working-capital","status":"publish","type":"knowledge","link":"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/what-is-working-capital\/","title":{"rendered":"Working capital: a simple guide for businesses"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">It can be tricky to see the whole financial picture of your business. With short term debts like utility bills, wages, and taxes going out of your business while sales are coming in \u2013 wouldn\u2019t it be great to have a clear indicator of your financial health?<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital is just that. And while it may sound like a corporate buzzword, working out your working capital can be beneficial for businesses of all sizes. So what is the working capital meaning and why is it important? And how do you work it out? Read on to find out:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\"><a href=\"#what-is\">working capital definition<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#calculate\">how to calculate working capital using a formula<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#understanding\">why understanding working capital is crucial\u00a0<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#improve\">how to improve your working capital<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#challenges\">common working capital challenges (and how to overcome them)<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#cash-flow\">the difference between working capital and cash flow<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"#faqs\">working capital FAQs<\/a><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Read more top tips on <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/how-to-budget-calculator-and-guide-for-the-self-employed\/\" data-type=\"knowledge\" data-id=\"1294\" >managing your business finances<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-is\">What is working capital?&nbsp;<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital, sometimes called net working capital (NWC), is a budgeting metric that helps you understand the financial health of your business. It shows the amount of money you have readily available in your business to cover your short-term costs after paying off your short-term debts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Put simply, it helps you know how much money you have left once you\u2019ve paid for everything you need to. To figure out your working capital, there\u2019s a few terms you\u2019ll need to understand to get started.&nbsp;&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-liquid-assets-nbsp\">Liquid assets&nbsp;<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">A liquid asset is something you own in your business that can be quickly turned into cash without it losing much value.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Physical cash, bonds, stocks, and money in easy access bank accounts are all considered liquid assets. Things like company cars, specialist equipment, and property wouldn\u2019t be because they\u2019re more difficult to sell quickly.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Learn more about how to <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/funding\/small-business-funding-and-investment\/\" data-type=\"knowledge\" data-id=\"1155\" >develop your understanding of asset finance<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-liquidity-nbsp\">Liquidity&nbsp;<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Liquidity is a term that describes the type of assets you have in your business and how easily they can be turned into cash. Your business can be in a state of high liquidity or low liquidity.&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">high liquidity means you have lots of liquid assets in your business that can be exchanged for cash quickly if you need to&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">low liquidity means the opposite, that you have lots of assets that are more difficult to sell quickly<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Find out more about <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/funding\/what-is-liquidity-in-business\/\" data-type=\"knowledge\" data-id=\"1085\" >liquidity in business<\/a> and how it works.<\/p>\n\n\n\n<div id=\"nba-body-001\">\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-current-assets-and-liabilities\">Current assets and liabilities<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">These are the two key metrics to work out your working capital:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">your <strong>current assets<\/strong> are items in your business like cash, inventory, equipment, and property that have value&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">the money and services you owe are your <strong>current liabilities<\/strong>, like wages, tax, and bills<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"calculate\"><strong>How to calculate working capital with a formula<\/strong>\u00a0<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">You can find out the working capital of your business through a simple formula. The basic formula is: <strong>your current assets &#8211; current liabilities = your working capital<\/strong>.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">So if the <strong>current assets<\/strong> in your business are worth \u00a3100,000 and your <strong>current liabilities<\/strong> are \u00a380,000, your <strong>working capital<\/strong> would be \u00a320,000.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The example above would be described as a positive working capital because the number is above zero.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s when businesses end up with a negative working capital that something needs to change.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You\u2019ll also need to consider the liquidity of your assets. Even if you have a positive working capital, assets with low liquidity could cause problems in the future.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Read on for more examples of a positive working capital and negative working capital.<\/p>\n\n\n\n<div class=\"wp-block-group has-azure-300-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-69910985 wp-block-group-is-layout-constrained\" style=\"border-radius:10px;padding-top:var(--wp--preset--spacing--20);padding-right:var(--wp--preset--spacing--90);padding-bottom:var(--wp--preset--spacing--50);padding-left:var(--wp--preset--spacing--90)\">\n<h3 class=\"wp-block-heading\" id=\"h-example-positive-working-capital\">Example: positive working capital<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">A family gardening business has the following assets:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">cash \u2013 \u00a355,000<\/li>\n\n\n\n<li class=\"wp-block-list-item\">equipment \u2013 \u00a335,000<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">It also has liabilities, including:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">wages \u2013 \u00a345,000<\/li>\n\n\n\n<li class=\"wp-block-list-item\">tax \u2013 \u00a36,500<\/li>\n\n\n\n<li class=\"wp-block-list-item\">credit card debt \u2013 \u00a32,000<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Working capital calculation:<\/strong> The business\u2019s assets (worth \u00a390,000) minus its liabilities (worth \u00a353,500) leaves it with a positive working capital of \u00a336,500.<\/p>\n<\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<div class=\"wp-block-group has-azure-300-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-69910985 wp-block-group-is-layout-constrained\" style=\"border-radius:10px;padding-top:var(--wp--preset--spacing--20);padding-right:var(--wp--preset--spacing--90);padding-bottom:var(--wp--preset--spacing--50);padding-left:var(--wp--preset--spacing--90)\">\n<h3 class=\"wp-block-heading\" id=\"h-example-negative-working-capital\">Example: negative working capital<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">A small marketing agency has the following assets:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">cash \u2013 \u00a345,000<\/li>\n\n\n\n<li class=\"wp-block-list-item\">equipment \u2013 \u00a37,500<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Its current liabilities are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">wages \u2013 \u00a375,000<\/li>\n\n\n\n<li class=\"wp-block-list-item\">tax \u2013 \u00a310,500<\/li>\n\n\n\n<li class=\"wp-block-list-item\">business loan \u2013 \u00a37,500<\/li>\n\n\n\n<li class=\"wp-block-list-item\">utility bills \u2013 \u00a35,000<\/li>\n\n\n\n<li class=\"wp-block-list-item\">rent \u2013 \u00a315,000<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Working capital calculation:<\/strong> The business\u2019s assets (worth \u00a352,500) minus its liabilities (worth \u00a3113,000) leave it with a negative working capital of -\u00a360,500.<\/p>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-why-understanding-your-working-capital-is-crucial\">Why understanding your working capital is crucial\u00a0<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">For small businesses, maintaining a <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/cash-flow\/what-is-a-cash-flow-forecast\/\" data-type=\"knowledge\" data-id=\"972\" >steady cash flow<\/a> is crucial. Figuring out your working capital is a good pulse check on how easily you\u2019ll be able to meet your financial obligations.&nbsp;&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It can be easy to lose sight of how your business is doing financially because you can have lots of incomings and outgoings, which doesn\u2019t give you a clear idea of what\u2019s left. Not knowing or misjudging your working capital can lead to a variety of issues for your business like:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">failing to pay your suppliers&nbsp;<\/li>\n\n\n\n<li class=\"wp-block-list-item\">falling behind on your bills<\/li>\n\n\n\n<li class=\"wp-block-list-item\">increasing your debt&nbsp;<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">You can also view your working capital as your safety net. As it\u2019s technically additional income, you could save it for a rainy day and add it to your <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/what-is-a-sinking-fund-for-business\/\" data-type=\"knowledge\" data-id=\"1257\" >sinking fund<\/a>. Having extra cash for an emergency could help you get through a rough patch.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But understanding your working capital isn\u2019t only about avoiding difficult financial situations \u2013 it\u2019s also about working more efficiently, and seeing what headroom you have for growth.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You could plan to use 10 per cent of your <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/business-tax\/how-to-calcuate-return-on-capital-employed\/\" data-type=\"knowledge\" data-id=\"1421\" >working capital on investing<\/a> in new equipment, for example. Or if you\u2019re looking to <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/management\/sell-a-business\/\" data-type=\"knowledge\" data-id=\"1190\" >sell your business<\/a>, a healthy working capital is one of the financial measures potential buyers will be looking for.&nbsp;&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">So understanding and improving your working capital is a good idea for most businesses, regardless what stage of growth you\u2019re in.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Find out more about <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/how-to-budget-calculator-and-guide-for-the-self-employed\/\" data-type=\"knowledge\" data-id=\"956\" >balancing your business budget<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"improve\">How to improve your working capital<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">There are a few different ways you can improve your working capital that aren\u2019t just about making more money:\u00a0<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\"><strong>managing stock<\/strong> \u2013 make sure you\u2019re not <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/retail\/how-to-do-a-stock-take\/\" data-type=\"knowledge\" data-id=\"1428\" >overstocked or understocked<\/a>, this way you\u2019ll avoid spending too much in one go and protect your cash flow<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><strong>negotiating longer payment terms <\/strong>\u2013<strong> <\/strong>&nbsp;with your regular suppliers, sometimes it\u2019s possible to spread your costs over long periods to reduce your short-term debts<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><strong>checking credit scores<\/strong> \u2013 taking the time to <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/business-tax\/what-is-business-credit-score-and-how-can-you-improve-it\/\" data-type=\"knowledge\" data-id=\"1060\" >check the credit score<\/a> of a business can help you <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/cash-flow\/what-to-do-if-someone-doesnt-pay-you-for-a-job\/\" data-type=\"knowledge\" data-id=\"917\" >avoid late payments<\/a> and keep a steady cash flow&nbsp;&nbsp;&nbsp;&nbsp;<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Find out more about how to create a strong <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/strategy\/small-business-strategy-examples\/\" data-type=\"knowledge\" data-id=\"17765\" >business strategy<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"challenges\">Common working capital challenges and how to overcome them<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">There are a range of business challenges that could affect your working capital, including:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\"><strong>unexpected costs <\/strong>\u2013 these can make it harder to plan and manage your finances. Having cash reserves in place can help you to stay on track<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><strong>late payments <\/strong>\u2013 if customers don\u2019t pay, you might struggle to pay your short-term debts. Make sure you have clear payment terms and a process in place to chase outstanding payments<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><strong>seasonal fluctuations<\/strong> \u2013 if you have ups and downs throughout the year, there could be times when your finances are stretched. Again, having healthy cash reserves can help you to get through the leaner periods<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><strong>poor stock management <\/strong>\u2013 overstocking could mean your business has cash it might need to pay debts tied up in assets, while understocking could lead to missed opportunities and lower income. That\u2019s why it\u2019s important to make sure you understand the supply and demand of your customer base and complete a regular and thorough <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/retail\/how-to-do-a-stock-take\/\" data-type=\"knowledge\" data-id=\"1428\" >stock take<\/a><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"cash-flow\">Working capital vs cash flow \u2013 what&#8217;s the difference?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital is a snapshot of a business\u2019s financial health from a specific moment in time. It can be worked out using information taken from the balance sheet.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Cash flow shows the money coming in and out of a business over a period of time (e.g. a month, quarter, or year). You can work out your cash flow using a cash flow statement.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital and cash flow are closely linked and impact each other. Working capital shows what funds you have available to pay debts, while cash flow shows how those funds have become available through income and expenditure.<\/p>\n\n\n\n<div class=\"wp-block-group has-azure-200-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-30c80bf8 wp-block-group-is-layout-constrained\" style=\"border-radius:35px;margin-top:var(--wp--preset--spacing--90);margin-bottom:var(--wp--preset--spacing--90);padding-top:var(--wp--preset--spacing--90);padding-right:var(--wp--preset--spacing--90);padding-bottom:var(--wp--preset--spacing--90);padding-left:var(--wp--preset--spacing--90)\">\n<h2 class=\"wp-block-heading\" id=\"h-recap-what-is-working-capital\">Recap \u2013 what is working capital?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital is a simple way to get an indication of your company\u2019s financial health. It measures how quickly and easily you can convert assets into cash and, as a result, whether you\u2019re in a good position to meet your short-term financial obligations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Businesses with a healthy working capital are able to improve or expand through investment. Those with a negative working capital could be at risk of financial difficulty in the future.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Read more tips on <a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/how-to-calculate-profit-margin\/\" data-type=\"knowledge\" data-id=\"843\" >boosting your business profit<\/a>.<\/p>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"faqs\">Working capital FAQs<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-what-is-working-capital-in-simple-terms\">What is working capital in simple terms?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Working capital is a simple formula to work out the financial health of your business. By subtracting your costs from your assets, you get a number which is an indication of your position. If the number is above zero, you have a positive working capital. If it\u2019s below zero, your working capital is negative.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-how-does-working-capital-management-differ-for-product-based-vs-service-based-businesses\">How does working capital management differ for product-based vs. service-based businesses?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">If you run a service-based business, you won\u2019t have physical products so inventory management won\u2019t be a priority. However, you\u2019ll need to focus on billing for projects and collecting payments on time to have a positive working capital.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For product-based businesses, solid inventory management and supply chain management will have the biggest impact on working capital.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-can-a-business-have-too-much-working-capital-if-so-what-are-the-risks\">Can a business have too much working capital? If so, what are the risks?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">If a business has a positive working capital, it\u2019s always likely to be better than having a negative working capital. However, there are risks associated with having a high working capital ratio.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Having too much working capital could indicate that a business isn\u2019t using its assets effectively. Being overly conservative could mean a business misses opportunities for investment or expansion.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-more-useful-articles-for-small-business-owners-nbsp\">More useful articles for small business owners&nbsp;<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li class=\"wp-block-list-item\"><a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/business-tax\/what-is-bookkeeping\/\" data-type=\"knowledge\" data-id=\"1259\" >What is bookkeeping?<\/a>&nbsp;<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/business-tax\/how-much-does-an-accountant-cost\/\" data-type=\"knowledge\" data-id=\"809\" >Do you need to hire an accountant?<\/a>&nbsp;<\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/funding\/best-small-business-loans\/\" data-type=\"knowledge\" data-id=\"22720\" >7 best business loans compared<\/a><\/li>\n\n\n\n<li class=\"wp-block-list-item\"><a href=\"https:\/\/www.simplybusiness.co.uk\/business-insurance\/faq\/what-is-public-liability-insurance\/\">What is public liability insurance?<\/a><\/li>\n<\/ul>\n\n\n\n<div id=\"nba-upsell-001\" class=\"wp-block-group has-azure-200-background-color has-background has-global-padding is-layout-constrained wp-container-core-group-is-layout-94e519ba wp-block-group-is-layout-constrained\" style=\"padding-top:var(--wp--preset--spacing--80);padding-right:var(--wp--preset--spacing--40);padding-bottom:var(--wp--preset--spacing--80);padding-left:var(--wp--preset--spacing--40)\">\n<h3 class=\"wp-block-heading has-text-align-center\">Ready to set up your cover?<\/h3>\n\n\n\n<p class=\"has-text-align-center wp-block-paragraph\">As one of the UK&#8217;s biggest <a href=\"\/business-insurance\/\" data-type=\"page\" data-id=\"5152\" >business insurance<\/a> providers, we specialise in <a href=\"\/business-insurance\/public-liability-insurance\/\">public liability insurance<\/a> and protect more trades than anybody else. Why not take a look now and build a quick, tailored quote?<\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-a89b3969 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/quote.simplybusiness.co.uk\/business\">Start your quote<\/a><\/div>\n<\/div>\n<\/div>\n\n\n\n<div id=\"nba-body-end\">\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Want to know what working capital is and how it can help your business\u2019s finances?<\/p>\n","protected":false},"author":59,"featured_media":22989,"comment_status":"open","ping_status":"closed","template":"","meta":{"sb_hreflang":"","sb_hreflang_url":"","disable_breadcrumbs":false,"sb_breadcrumbs":[],"sb_reviewed_by":"","sb_review_date":"","sb_enable_content_gating":true,"footnotes":""},"categories":[350,338,329],"hidden-category":[],"coauthors":[23],"class_list":["post-22988","knowledge","type-knowledge","status-publish","has-post-thumbnail","hentry","category-cash-flow","category-management","category-income"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.2 (Yoast SEO v27.2) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Working capital: a simple guide for businesses | Simply Business<\/title>\n<meta name=\"description\" content=\"Learn what working capital is, why it\u2019s important, and how it impacts your business with this simple guide for business owners.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.simplybusiness.co.uk\/knowledge\/income\/what-is-working-capital\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Working capital: a simple guide for businesses\" \/>\n<meta property=\"og:description\" content=\"Want to know what working capital is and how it can help your business\u2019s finances? 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