Working capital: Definition, Formula & Why It Matters
Working capital is the liquid money you have available to run and grow your shop, calculated as current assets minus current liabilities. For most Reverb sellers, inventory is the largest piece, so unsold stock ties up the very capital you need to buy more.
Working capital formula
Example
With $15,000 in cash and inventory and $5,000 owed to suppliers, working capital is $10,000.
Why it matters for Reverb sellers
Every dollar locked in slow-moving gear is a dollar you cannot use for marketing, new inventory, or covering a slow month. Managing working capital is the difference between scaling smoothly and constantly feeling cash-tight.
How Verbstack helps
Verbstack surfaces how much capital is tied up in inventory so you can keep cash working instead of sitting on shelves.
Track this on every order, automatically.
- ✓ Real fees, margins, and profit on every Reverb sale
- ✓ COGS and inventory tracked for you, no spreadsheet
- ✓ Full history and a live monthly P&L
Free forever to get started. No credit card required.
Related terms
See this number on every order.
Connect your Reverb shop and Verbstack tracks your fees, margins, and profit automatically.
Get started freeFree forever to get started. No credit card required.