Modern Australian
The Times Real Estate

.

Aon Study Shows Businesses in Asia Pacific Taking Longer to Convert Working Capital into Cash, Affecting Liquidity

Average days receivable for most sectors increased compared to previous year

SINGAPORE - Media OutReach Newswire - 24 September 2024 - Aon plc (NYSE: AON), a leading global professional services firm, today announced the release of its 2024 Working Capital and Performance Benchmarking Report for Asia Pacific.

The study examines the working capital performance and practices of more than 900 companies across 21 industries and 12 countries/territories in the Asia Pacific region.

According to the report, the average days receivable for Asia Pacific companies for year ending 2023 was 71 days. Although a small increase from 2022, an increase in days receivable reflects a decrease in working capital availability and indicates slower collection of cash from customers.

The report also reveals significant variations in days receivable across industries and countries/territories, highlighting the need for regional and sector-specific solutions. In the financial year ending 2023, companies in Japan reduced their days receivable by five days to 42 days and now lead the region in days receivable performance. Conversely, companies' days receivable increased considerably in Hong Kong at 65 days (+3.6), Thailand at 64 days (+2.6) and India (+2.7). While Hong Kong and Thailand remain below the regional average of 71 days, India fell further back to 100 days, emphasizing an opportunity for Indian corporates to optimize their working capital management.

Aon Study Shows Businesses in Asia Pacific Taking Longer to Convert Working Capital into Cash, Affecting Liquidity

Steve Taylor, head of credit solutions in Asia for Aon, said: "Working capital is crucial for any business, especially in times of uncertainty and volatility. When companies take longer to convert their working capital into cash, it can affect their liquidity and profitability. Businesses must identify areas for improving working capital availability and implement strategies such as using credit insurance to protect against the risk of non-payment, support revenue growth and secure financing. By applying data-driven insights companies can make better decisions to optimise their working capital management and generate significant value for their business."

Benchmarking against industry competitors is crucial for identifying areas for improvement in the working capital cycle. Japanese corporates, for example, are the regional leader in days receivable across all sectors, however within the electrical products sector they fall behind the industry average and are 27 days slower than their Korean competitors in the same sector.

The report suggests that best-in-class companies can leverage working capital efficiencies to generate free cash flow and reduce debt levels demonstrating the strategic importance of effective working capital management.

Ankit Tambe, regional director, credit solutions in Asia for Aon, said: "Benchmarking an organisation's days receivable against peers is an important step in assessing financial health and evaluating working capital performance. By reviewing credit solutions strategies to shorten the cash conversion cycle and unlock trapped capital, organisations can drive greater value creation and enable business growth."

For more information about the Working Capital and Performance Benchmarking report, click here.

Hashtag: #Aon

About Aon

(NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that protect and grow their businesses.

Follow Aon on , , and . Stay up-to-date by visiting Aon's and sign up for news alerts .

Disclaimer
The information contained in this document is solely for information purposes, for general guidance only and is not intended to address the circumstances of any particular individual or entity. Although Aon endeavours to provide accurate and timely information and uses sources that it considers reliable, the firm does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of any content of this document and can accept no liability for any loss incurred in any way by any person who may rely on it. There can be no guarantee that the information contained in this document will remain accurate as on the date it is received or that it will continue to be accurate in the future. No individual or entity should make decisions or act based solely on the information contained herein without appropriate professional advice and targeted research.

Commercial Plastering Can Boost Your Business Appeal

In business, appearances matter. The way your space looks sets the tone for how clients, customers, and even your staff perceive your brand. A well-...

How to Transfer Registration When You Buy a Used Car in Brisbane

Purchasing a second-hand car can be a thrilling experience, but there's more to it than simply handing over the cash and driving off. One very impor...

Expert Tips for Comparing Budget Movers and Energy Providers For a Modern Apartment

Starting a new life in a modern apartment can be a challenging yet exciting step. While moving into a modern apartment, people always need reliable ...

Slowing Down in Nature: My Experience on Orchid Classic Cruise in Lan Ha Bay

Why Orchid Classic is a Top Choice for Lan Ha Bay Lan Ha Bay, a hidden gem adjacent to the more famous Ha Long Bay, offers travelers a quieter and ...

Your Next Travel Essential? Why Aussies Love Lightweight Electric Wheelchairs

Planning for a trip or just getting around town? A lightweight electric wheelchair could be your perfect travel mate. Whether it’s a stroll throug...

Australian Study Woes – What is a Confirmation of Enrolment?

Recent changes to Australian study visas are altering the landscape for international students who want to learn and work on our shores.  To secur...

Metal lockers vs. wooden lockers: which is better?

Lockers—the ultimate background hero of the workplace. They might not have the flashiness of that overpriced espresso machine in the break room, b...

Invisalign Treatment: What Your Dentist Wants You to Know

When straightening the teeth, out-of-date metal braces are no longer the only option. Nowadays, Invisalign is among the most highly sought-after alt...

The Best Nail Art for Short Nails

Short nails often get overlooked in the world of nail art, but they’re actually the perfect canvas for stylish, sophisticated designs. Whether you...

How Much Does a Skip Bin Cost? Skip Bin Prices, Sizes & What Influences the Price

Regardless of whether you're renovating a house. You are tidying up your backyard, or running a construction site. Chances are you'll require a skip...

Panoramic Elevators: Combining Functionality with Aesthetic Appeal

In the evolving world of building design, the demand for architectural features that are both practical and visually striking continues to rise. One...

No Dig, No Drama: Sydney Pipe Relining Explained

You know that feeling when water starts pooling where it shouldn't? Or received a quote for pipe repairs that made your eyes water? Let's chat about...

The SEO Benefits of AI-Optimized Landing Pages: Smarter Metadata, Faster Load Times

Landing pages are integral to the conversion funnel in digital marketing. Yet, when SEO works well to drive traffic to the landing page, it's just a...

How to Reduce Turbo Lag with an Upgraded Mazda BT-50 Exhaust System

Are you struggling with turbo lag affecting your driving experience?  Did you know upgrading your Mazda BT-50 exhaust system could be the key to u...

How to Segment Email Lists Based on Content Engagement (Not Just Demographics)

Email segmentation generally refers to age, location, gender demographic, and conventional elements. While this could be helpful information, it doe...

6 Qualities to Look for in Local Caravan Dealers

If you're searching for reliable caravan dealers in Campbellfield, it's essential to choose a dealer that offers quality products, excellent custome...

How to Repair a Faema Coffee Machine: A Practical Guide for Coffee Lovers

Introduction If you’re the proud owner of a Faema coffee machine, you already know that it’s more than just a kitchen appliance — it’s a vi...

Smart Health Decisions in Your 30s, 40s, and 50s: The Ultimate Prevention Guide

Making informed health decisions becomes increasingly important as we navigate through different life stages. What may have seemed unimportant in our ...