Finance in manufacturing
manufacturing finance: COGS and cost accounting, capacity and fixed-cost absorption, capex and asset utilization, and working capital in inventory.
Manufacturing finance runs on capital intensity, working capital discipline, and margin control across long production cycles. This block builds fluency in how manufacturers finance plant and equipment, manage inventory and supplier terms, and price products to protect margins under fixed-cost pressure. You will work through the financial logic of capex decisions, cost accounting methods specific to production, and the metrics investors and lenders use to judge a manufacturer's health, from asset turnover to cash conversion cycle. The block closes with the regulatory and risk landscape unique to the sector, including cost accounting standards, environmental liabilities, and supply chain financial exposure, plus the due-diligence checks used before investing in or lending to a manufacturing business.
What you'll master
- Calculate and interpret core manufacturing financial ratios such as inventory turnover, cash conversion cycle, and asset turnover using real benchmark ranges
- Evaluate a capital expenditure decision using payback, NPV, and ROIC logic adapted to plant and equipment investments
- Read a manufacturer's financial statements to assess fixed cost leverage, gross margin drivers, and working capital efficiency
- Conduct a basic financial due-diligence review of a manufacturing company, identifying regulatory, cost, and supply chain risks
Key terms
Modules
Covers how core finance concepts apply to plant costs, capex, and inventory.
Teaches the key metrics and benchmarks that measure a plant's health.
Covers the regulations, hidden liabilities, and risk checks manufacturers face.
Latest articles
Recent articles from the blog that apply to Manufacturing.
- $100/kWh and falling: the battery cost math every automotive CFO must ownThe $100 per kilowatt-hour threshold has long been treated as the point at which electric vehicles become cost-competitive with internal combustion equivalents on a per-unit basis. But in a year when consumer confidence has hit a 12-year low and EV demand is softening across major markets, CFOs need to understand exactly what that number means for their break-even models, and where it breaks down.
- When the activist already knows more than you do: lessons from Elliott at HoneywellAI-powered hedge funds can now build a detailed financial thesis on your company faster than your IR team can schedule a response meeting. The Honeywell-Elliott engagement shows what happens when a CFO is prepared for that reality, and what it costs when the board is not.
- How Unilever rebuilt its planning architecture around xP&AUnilever spent years running finance, sales, and supply chain planning in parallel silos, each optimised locally but disconnected at the seams. Its shift toward extended planning and analysis shows what xP&A integration actually requires in a business of that complexity.
- The night Chrysler's CFO discovered the credit market had closedIn late 2008, Chrysler's treasury team woke up to a commercial paper market that had effectively stopped functioning overnight. What happened next became one of the most instructive case studies in corporate liquidity management that business schools still use today.
- Supply chain finance and dynamic discounting: the working capital lever CFOs underuseSupply chain finance and dynamic discounting are two distinct tools that let companies extract cash from payment terms without touching credit lines. Understanding the mechanical difference between them, and when each one backfires, is where the real CFO value sits.
- Working capital optimization as a source of strategic liquidity: a CFO playbookMost CFOs sit on a significant cash reserve they have not yet recognized: the working capital trapped in their own operations. This playbook shows how to extract it systematically, without touching the credit facility or the dividend.