Working capital terms refer to the financial structure of a business. It is the difference between current assets, such as cash and inventory, and current liabilities, such as accounts payable and short-term debt. Having healthy working capital terms ensures that a company can pay its bills and still have enough liquidity to purchase new materials, employ new staff, or unexpected expenses. Companies need access to ample working capital for sustained success. It is important to know how to budget and manage working capital terms in order to maximize a business’s potential.