Release cash from stock and debtors, without borrowing a dollar
“We’ve never been busier, and we’ve never been shorter of cash.”
It is the sentence we hear more than any other from Caribbean business owners in trouble, and it sounds like a contradiction. It is not. It is arithmetic. A business that pays its suppliers in 30 days, holds stock for 120 and waits 75 days to be paid is financing 165 days of its own trading. Every new contract makes the gap bigger. In that kind of business, growth is not the relief. Growth is the pressure.
Count the days, not the boxes
The number that explains this is the cash conversion cycle: stock days plus debtor days, minus creditor days. It tells you how many days of trading your business funds out of its own pocket before a customer’s money comes back.
In this region it commonly runs from 90 to 150 days, and most owners have never calculated it. The reasons are familiar. Shipping lead times encourage buying ahead. Large customers, including government, pay slowly and know you will wait. Suppliers abroad want deposits. Nobody measures any of it weekly, so nobody sees it growing.
The third stage of The Dawgen RECOVER™ Framework, Cash and Working Capital, starts by counting those days. Then it gets them back.
What one day is worth
Every day removed from the cycle releases cash. For an illustrative composite distributor with JMD 600 million of sales and JMD 420 million of cost of sales, each day of debtors is worth about JMD 1.6 million and each day of stock about JMD 1.15 million.
| Lever | Before | After | Cash released |
| Debtor days | 75 | 50 | about JMD 41 million |
| Stock days | 120 | 90 | about JMD 35 million |
| Creditor days | 30 | 40 | about JMD 12 million |
| Cash conversion cycle | 165 | 100 | about JMD 87 million |
That is roughly 15% of a year’s sales, raised without a new loan, a new investor or anyone’s permission. For a business under pressure, it is often the difference between a forced sale and a planned recovery.
Where the cash is hiding
In your debtors. Rank every account by value, age and likelihood of payment, and work the top twenty personally. Invoice on delivery, not at month-end. Fix the billing errors that give customers a reason to delay. Move to a weekly collections rhythm with a set escalation at 7, 30, 45 and 60 days. For large institutional debtors, look at payment certificates and invoice discounting rather than simply waiting.
In your stock. Sort every line by value and by how predictable its demand is. Hold safety stock only on the lines that earn it. Anything that has not moved in six months is not an asset; it is cash you have already spent. Clear it, even at a discount, and stop reordering ahead of need simply because the container is coming anyway.
In your supplier terms. Suppliers extend terms to customers they trust. A weekly cash forecast and a record of paying on the agreed date, every time, is worth more in that conversation than any complaint about market conditions.
In leakage. Subscriptions nobody uses, vehicles nobody needs, related-party payments without contracts, cash sales not reconciled daily. Individually small. Together, often surprising.
In your tax position. Unclaimed refunds and input-tax credits are cash owed to you.
One line is not on the list. Never stretch statutory payments. GCT, PAYE, NIS and pension deductions are not a source of finance. They carry penalties, they compound, and they put directors personally at risk. Stopping new arrears is one of the first rules of RECOVER™.
Then match the money to the job
Releasing cash is half the work. The other half is making sure the problem does not return. Most distressed Caribbean businesses have used short money for long purposes: a demand overdraft funding permanent stock, operating cash buying vans, a seven-year loan financing a thirty-year building.
RECOVER™ uses a simple tool we call the Funding Match. For every use of money, ask how long the thing being funded will live, and fund it with an instrument that lives as long. Seasonal stock on a revolving line. Equipment on asset finance. Property on long-tenor, interest-led debt. The permanent part of the overdraft converted to a term loan.
It sounds obvious. It is also the single most common structural fault we find.
The test to run this month
Calculate your cash conversion cycle from your last month-end. Then ask what it would be worth to take thirty days out of it. Multiply your daily cost of sales by thirty. That is the size of the opportunity sitting in your own warehouse and ledgers.
Find the cash in your business
Find out how much cash is sitting in your stock and debtors, in two weeks, confidentially. A RECOVER™ Diagnostic calculates your cash conversion cycle line by line, builds a Working Capital Release Plan with each action costed, owned and dated, and shows it in your first 13-week cash flow.
Not ready to talk? Request the RECOVER™ Cash Conversion Cycle calculator and run the numbers yourself.
Talk to us in confidence. Dawgen Global serves clients across more than 15 Caribbean territories through one borderless delivery model.
[email protected] · https://www.dawgen.global/
Big Firm Capabilities. Caribbean Understanding.
Next in the series: “Take Back Control of Your Cash in 14 Days.”
This article describes patterns observed in private company advisory work. Examples are illustrative composites, not Dawgen Global clients. It is general information, not advice for any specific business.
About Dawgen Global
Dawgen Global is an independent, integrated multidisciplinary professional services firm headquartered at 47 Trinidad Terrace, New Kingston, Jamaica, serving more than 15 territories across the Caribbean. Founded and led by Dr. Dawkins Brown, Executive Chairman, the firm is independent and not affiliated with any international network. It delivers a full suite of professional services under one roof: audit and assurance; tax advisory; IT and digital transformation; risk management; cybersecurity; actuarial and insurance regulatory advisory; HR advisory; mergers and acquisitions; corporate recovery; business advisory and strategy; accounting BPO and virtual CFO services; and legal process outsourcing.
The proposition is simple: big-firm capability without the big-firm price. Dawgen Global’s integrated approach is built for the specific complexities and opportunities of the Caribbean market, helping organizations make sharper, better-informed decisions that drive measurable progress.
To explore a partnership, reach out:
- Website: dawgen.global
- Email: [email protected]
- WhatsApp (Global): +1 555-795-9071
- Caribbean offices: +1 876-665-5926 | +1 876-929-3670 | +1 876-926-5210
