Financing Solutions for Effective Working Capital Management

One of the critical recurring funding requirements for the companies is to finance their working capital gaps. Yet, working capital gaps are unique to each business and arise on account of the need to build up inventory before delivery is scheduled, the need to pay suppliers before it can realize receipts from customers, and long sales realization cycles. Raising the right kind of financing for meeting the working capital gap helps businesses grow effectively.

What are the financing options for such recurring requirements - should we rely on equity, take out debt, get credit from the suppliers or advance from customers? Is it better to use Equity for working capital as debt appears costly?