Working Capital Calculator
Calculate your business working capital needs and cash flow gaps. Free NZ working capital calculator to determine optimal funding requirements.
💡 Cash Flow Tip: Most NZ businesses need 30-90 days of working capital to cover the gap between sales and customer payments.
Working Capital Calculator
Calculate your working capital needs
Types of Working Capital Finance
📋 Invoice Finance
What it is: Borrow against unpaid invoices
Access: Up to 90% of invoice value
Speed: Same-day funding available
Rate: 0.5% - 3% per month
Best for: B2B businesses with 30+ day payment terms
💳 Business Overdraft
What it is: Flexible credit line on business account
Access: $5K - $100K typical limits
Speed: Instant access once approved
Rate: 8.95% - 21.95% p.a.
Best for: Seasonal businesses, temporary gaps
🔄 Trade Finance
What it is: Finance for inventory and stock
Access: Based on purchase orders
Speed: 2-5 days for approval
Rate: 1.5% - 4% per month
Best for: Import/export, retail, manufacturing
💰 Asset Finance
What it is: Secured lending against business assets
Access: 50-80% of asset value
Speed: 1-2 weeks for approval
Rate: 6.95% - 16.95% p.a.
Best for: Property, equipment-heavy businesses
⚡ Cash Advance
What it is: Advance based on card sales history
Access: 2-12x monthly card sales
Speed: 24-48 hour funding
Rate: 10% - 50% factor rate
Best for: Retail, hospitality, high card volume
🏦 Working Capital Loan
What it is: Term loan specifically for working capital
Access: $10K - $500K typical
Speed: 3-10 days for approval
Rate: 7.95% - 24.95% p.a.
Best for: Growth funding, inventory buildup
Current NZ Working Capital Finance Rates (January 2025)
🏦 Big Four Banks
🚀 Invoice Finance
⚡ Alternative Lenders
Working Capital Needs by Industry
🏪 Retail
Typical Need: 60-120 days
Key Factor: Seasonal inventory
Best Finance: Trade finance, overdraft
Peak Periods: Pre-Christmas, Easter
🏗️ Construction
Typical Need: 90-180 days
Key Factor: Long payment terms
Best Finance: Progress payments, overdraft
Challenge: Material cost fluctuations
⚙️ Manufacturing
Typical Need: 45-90 days
Key Factor: Raw material inventory
Best Finance: Invoice finance, asset finance
Advantage: Predictable cash cycles
💻 Professional Services
Typical Need: 30-60 days
Key Factor: Client payment terms
Best Finance: Invoice finance, overdraft
Advantage: Low inventory needs
🍽️ Hospitality
Typical Need: 15-45 days
Key Factor: Daily cash receipts
Best Finance: Cash advance, overdraft
Challenge: Seasonal variations
🚚 Transport
Typical Need: 30-75 days
Key Factor: Fuel costs, maintenance
Best Finance: Invoice finance, fuel cards
Benefit: Regular customer contracts
🏥 Healthcare
Typical Need: 20-60 days
Key Factor: Insurance claim delays
Best Finance: Overdraft, asset finance
Advantage: Steady patient flow
🌾 Agriculture
Typical Need: 120-365 days
Key Factor: Seasonal production cycles
Best Finance: Seasonal facility, overdraft
Challenge: Weather dependency
How to Use the Working Capital Calculator
📊 Basic Calculation Steps
- 1. Enter your average monthly revenue
- 2. Add your average monthly expenses
- 3. Input average customer payment terms (days)
- 4. Enter inventory holding period (days)
- 5. Click calculate to see your working capital needs
- 6. Review your cash cycle and monthly gap
💡 Understanding Your Results
- ✓ Cash Cycle: Days from expense to payment
- ✓ Working Capital Need: Total funding required
- ✓ Monthly Gap: Regular shortfall amount
- ✓ Positive result: You need working capital
- ✓ Negative result: Strong cash position
- ✓ High cycle: Consider invoice finance
Working Capital Formula Explained
Working Capital Need = (Daily Expenses × Cash Cycle Days)
📋 Formula Components
Cash Cycle Days =
Customer Payment Terms + Inventory Days
Daily Expenses =
Monthly Expenses ÷ 30
Monthly Gap =
Expenses - (Revenue × Collection Rate)
💡 Example Calculation
Example Business:
- • Monthly Revenue: $50,000
- • Monthly Expenses: $40,000
- • Payment Terms: 30 days
- • Inventory: 15 days
Calculation:
Cash Cycle = 30 + 15 = 45 days
Daily Expenses = $40,000 ÷ 30 = $1,333
Working Capital Need = $1,333 × 45 = $60,000
Working Capital Finance vs Other Options
| Feature | Invoice Finance | Business Overdraft | Term Loan | Cash Advance |
|---|---|---|---|---|
| Speed | Same day | 1-5 days | 3-10 days | 24-48 hours |
| Cost | 1.5-3%/month | 12-20% p.a. | 8-25% p.a. | 20-60% p.a. |
| Flexibility | Invoice dependent | Very flexible | Fixed repayments | Daily deductions |
| Amount | Up to 90% invoices | $5K - $100K | $10K - $500K | 2-12x monthly sales |
| Best For | B2B with 30+ day terms | Seasonal fluctuations | Growth investment | Card-heavy businesses |
Need Working Capital Finance?
Get personalized working capital quotes from New Zealand's top lenders. Compare invoice finance, overdrafts, and cash flow solutions.
Working Capital Calculator FAQ
What is working capital and why do I need it?
Working capital is the money needed to cover day-to-day operations between paying suppliers and receiving customer payments. Most businesses need it because they pay expenses before customers pay their invoices.
How much working capital does my business need?
Typically 30-90 days of operating expenses, depending on your cash cycle. Use our calculator to get a personalized estimate based on your payment terms and inventory requirements.
What's the difference between working capital and a business loan?
Working capital finance is short-term funding for day-to-day operations, while business loans are typically longer-term funding for growth, equipment, or property. Working capital is more flexible but often more expensive.
Should I choose invoice finance or a business overdraft?
Invoice finance is best if you have unpaid invoices and need immediate cash flow. Overdrafts are better for seasonal businesses or unpredictable cash flow needs. Invoice finance typically provides more funding.
How quickly can I get working capital finance?
Invoice finance can fund same-day, cash advances within 24-48 hours, overdrafts take 1-5 days, and working capital loans typically take 3-10 days. Speed depends on your documentation and lender choice.
Can I improve my working capital without borrowing?
Yes - negotiate shorter payment terms with customers, extend payment terms with suppliers, reduce inventory levels, offer early payment discounts, or improve collection processes.