As a continuation of John Mardle's ideas here is an example of how a deeper and broader view of your supply chain may offer opportunities for boosting working capital and long-term strategic company development.

So say you find a glitch in your supply chain: that glitch may not be about to happen, but it could happen.

Great Hope Corporation knows times are tight but having a sophisticated financial director, it tries to lower the risk to its working capital. This means it examines further along the financial supply chain.

At supply chain link number four is a small company, Rubber Supplies, that makes widgets required in the Great Machinator, a piece of plant at Manufacturing Company No. Three . The Great Machinator makes strawberry fudge and their fudge makes up the Wonderful Fudge Collection that is boxed and distributed by Distributor No. Two. This company supplies the Great Hope Corporation.

Now the Great Hope Corporation has examined the financial supply chain: the Wonderful Fudge Collection is their best-selling confectionery line. Should it not get delivered, it will lose a line of sales cash worth £30,000 per week. With regular examination of its supply chain and their finances, it seems that Rubber Supplies is having difficulty paying for raw materials – the cost of the commodity product has risen and one of the firms to which it supplies Widgets is in trouble and has not paid it £10,000.

Without having spare cash, it may not make one of its monthly deliveries of its Widget to keep the plant rolling at Manufacturing Company No: Three. Should this happen, a month's manufacturing could be lost, ultimately interrupting five weeks supply of strawberry fudge, or £150,000, in revenues and cashflow.

The Great Hope Corporation has cash-on-hand. It also knows Rubber Supplies. It makes good products but is a small family firm. It supplies Widgets to 40% of the confectionery manufacturers with which the Great Hope Corporation deals. In itself, Rubber Supplies is a good investment. A small equity holding taken by the Great Hope Corporation would provide the cash to keep Rubber Supplies' operations running and apart from the opportunity of future profitable returns, the Great Hope Corporation keeps its supplies rolling.

It could help finance the investment by getting Manufacturing Company No. Three to come in on the deal (since they too benefit) or renegotiate payment contracts, letting the Great Hope Corporation hold onto cash longer.

Another option for it might be to buy a new piece of plant to make the strawberry fudge but that doesn't need a widget. It could be placed at the Manufacturing Company No. Three since they have a proud manafacturing expertise.

By a deeper view of the financial supply chain, the Great Hope Corporation gives itself many more opportunities to defend the strength of its working capital.