CFOs at Medium size Hospitals Target Cash conversion Cycle Improvements: Survey Top finance executives at mid-size hospitals in Egypt said that we should improve CCC and they expect that their main source of growth capital over the next two years will be cash from ongoing operations, not debt or equity financing, according to a report from a survey in collaboration with Dar El Oyoun Hospitals and centers and Medical consultancy Group.
In a survey of 35 senior finance executives at hospitals with $10 million to $1. million in annual revenue, 55 % said that receivables performance would be their top priority for working-capital improvement over the next 2 years, compared to 23 % who cited inventory management, and 5 % who pointed to payables performance. Another 15 % said that all three categories would be a top priority. However, receivables performance is the most difficult part of the equation for hospitals of this size to control, as they are largely at the mercy of their larger competitors when it comes to payment terms and pricing, the report said.CFOs in the report said that they often withheld payments to vendors as long as they could without damaging the relationship, and that some suppliers had begun to threaten credit holds. But, those CFOs often feel helpless when they demand faster payment from larger companies, leaving them stuck in between.
Even so, being a mid-size hospital does have its advantages, the executives said. While they are often hard-pressed to set prices below those of larger competitors, the report said that mid-size hospitals fare better at maintaining relationships with customers and can provide better service by competing on better quality standards.
