0:00How long is your money tied up in one import?
0:03Map it out, from deposit to sale.
0:07Map out exactly how long your money is tied up on a typical import.
0:11It starts the day you pay a deposit.
0:14Then it runs through production and shipping, clearance,
0:18and finally the sale to your own customer.
0:22This period is sometimes called the cash conversion cycle.
0:26It can easily run several months for a sea shipment.
0:29Underestimating it is a common reason
0:33otherwise profitable import businesses run into cash shortages.
0:38You can shorten the cycle through faster clearance,
0:42better inventory turnover,
0:44or better supplier payment terms.
0:46That is as valuable to your business's health as improving your margin on paper.
0:53A shorter cycle means a healthier business.