The Inventory to Working Capital Ratio is an important metric for businesses to monitor in order to understand their financial health. It measures how much inventory a business has relative to its working capital, or liquid assets. A higher ratio indicates that the company has more inventory than it does working capital, and vice versa. As such, it’s important to ensure that a company doesn’t have too low of a ratio, as this can lead to cash-flow problems and ultimately hamper growth. On the other hand, if the ratio is too high, it could mean that the company is holding onto too much inventory, which ties up resources that could be used elsewhere. Monitoring this ratio is key to ensuring that businesses remain financially balanced and healthy.