The global business environment continues to challenge liquidity and finance managers. Inflation has moderated but not stabilised. Exchange rate pressures remain unpredictable across emerging markets, and the lingering effects of supply chain realignment, driven by ongoing tariff disputes, still influence how companies fund their operations.
In this environment, working capital planning is less about routine cash management and more about organisational resilience: how quickly and efficiently capital can move through the value chain when conditions change. Whether you are a finance director in a manufacturing firm, a Chief Financial Officer in the power sector, or a treasurer in agribusiness, how you manage your working capital in 2026 will strongly influence your capacity to invest, grow, and remain resilient, while building a robust and reliable supply chain.
Let us explore some dos and don’ts of working capital planning for the year ahead.
Do build cash flow visibility across the value chain
Working capital strength starts with clarity. It is not sufficient to simply know account balances at the month’s end. Finance leaders need timely insights into how cash is generated, where it is tied up, and when it will be released.
Integrating sales forecasts, procurement schedules, and payment data allows businesses to project liquidity with greater accuracy. This visibility helps you anticipate pressure points before they evolve into financing gaps.
It is also crucial to invest in digital treasury and trade platforms that connect internal Enterprise Resource Planning (ERP) data with supplier and customer transactions, particularly as businesses move towards electronic invoicing. The insight, efficiency, and economic gains associated with these investments often outweigh the initial outlay.
Don’t depend exclusively on traditional short-term borrowing
As monetary policy continues to adjust unevenly across regions, borrowing costs remain inconsistent and unpredictable. Companies relying solely on overdrafts or short-term debt to close liquidity gaps risk higher finance costs and increased refinancing pressure.
Explore structured working capital finance alternatives such as receivables finance, supply chain finance, or inventory-backed lending. These tools can unlock cash tied up in operations without overleveraging the balance sheet, while supporting business growth.
Do align working capital with strategic objectives
Working capital planning should mirror business priorities. If your growth strategy involves expanding exports, diversifying suppliers, or entering new markets, the liquidity model must evolve accordingly.
Exporters, for instance, must plan for longer receivable cycles and possible currency delays, while importers should account for potential customs bottlenecks and foreign exchange exposure. Integrating these realities into working capital forecasts and leveraging structured working capital and currency risk management solutions, prevents liquidity and currency surprises later.
Don’t rely on extended payables as a long-term solution
Extending payables can temporarily improve liquidity ratios, but often at the cost of supplier reliability. Supply disruption risk rises when partners begin to perceive payment uncertainty or feel pressured by repeated changes to agreed terms.
Structured supplier financing can help address this tension. It allows suppliers to receive payment earlier through a financing partner, while you retain your negotiated payment terms. Done properly, it preserves working relationships and supports continuity in the supply chain.
Do manage trade risks proactively
Trade flows are a major component of working capital and a key source of risk. In 2026, businesses will have to navigate heightened payment risk, foreign exchange volatility, and geopolitical uncertainty across supply routes.
Payment risk is a frequent pressure point. Delayed payments or defaults from buyers can disrupt cash flow and create knock-on effects across procurement and operations. Businesses can reduce this exposure by using instruments such as confirmed letters of credit, payment guarantees, or documentary collections to secure receivables and improve predictability.
Foreign exchange risk also requires deliberate planning. Currency movements can erode margins quickly, especially for exporters and importers operating on thin spreads. Hedging exposures through forward contracts can provide certainty, while natural hedging, matching currency inflows and outflows where possible, can reduce structural mismatch and cost.
Counterparty and country risk must also be monitored closely. Political or regulatory shifts can affect the ability to repatriate funds, honour contracts, or move goods. Due diligence on trading partners is essential, and diversifying sourcing across multiple markets can reduce concentration risk and improve resilience.
Finally, supply chain disruptions can trap capital in stalled inventories, delayed shipments, or unplanned buffers. Practical responses include negotiating flexible delivery terms, maintaining secondary suppliers, and monitoring shipping lead times as part of liquidity planning, rather than treating logistics as a separate operational issue.
When trade risk management is integrated into working capital planning, a company’s liquidity position becomes more predictable and less reactive to external shocks.
Do optimise inventory using data and demand insight
Inventory remains a major drain on cash if poorly managed. Use historical data, sales trends, and digitally driven forecasting to align stock levels with actual demand. In capital-intensive sectors such as power, manufacturing, or pharmaceuticals, predictability of project timelines must feed directly into inventory decisions.
Finance and operations teams should jointly track metrics such as Days Inventory Outstanding to ensure working capital efficiency translates into operational readiness, not just stronger ratios on paper.
Don’t treat working capital as a finance-only issue
Effective liquidity management involves every function. Procurement negotiates terms that affect payables; sales controls credit that influences receivables; operations determine how quickly inventory converts to cash.
Embedding working capital Key Performance Indicators (KPIs) across departments, tracked digitally via dashboards, promotes accountability and ensures liquidity efficiency is a shared goal rather than a finance target.
Do stress-test for market volatility
The next 12 months are unlikely to be calm. Exchange rates, commodity prices, global trade flows, and tariff disputes are likely to keep markets volatile.
Run periodic stress scenarios. For example, what happens if receivables are delayed by 20 days, or if input costs rise by 15%? Use these results to set minimum liquidity buffers, determine when to hedge, and decide which expenses can be deferred if required. This approach transforms working capital from a static plan into a flexible risk management tool.
Conclusion
In 2026, companies that excel at working capital planning will not necessarily be those with the largest cash reserves, but those that understand their liquidity dynamics and manage risk with foresight. The advantage will increasingly come from visibility, disciplined execution, and the ability to make informed decisions quickly as conditions change.
Effective working capital management depends on understanding how money moves through the business ecosystem and ensuring that its movement supports your company’s strategy.
