The Wall Street Journal takes a look at Apple’s cash flow

Apple’s unprecedented success over the past 10 years goes far beyond its ability to churn out hit products. It also has a knack for supply chain deals and is extremely efficient with its cash, and how it manages its balance sheet.

The Wall Street Journal takes a look at this in a new report entitled “Heard on the Street.” The piece explains, among other things, how Apple has streamlined its business to get paid for products faster than it makes them…

Here’s an excerpt from the article:

“Moreover, thanks to the efficiency with which Apple manages much of its balance sheet, the capital invested in its business is actually negative. In other words, Apple gets paid for its products faster than it pays to make them.

Cash comes in before it goes out in part because Apple has incredible negotiating leverage vis-a-vis its suppliers. On average, in fiscal 2011 it didn’t pay suppliers for 83 days after being invoice, according to Sanford C. Bernstein analyst Toni Sacconaghi. Yet Apple collected on its customer invoices much faster, 18 days on average. Meanwhile, it paid to keep just four days of inventory on hand in 2011, versus an already impressive 10 days in 2010.”

The entire thing is worth a read, as it demonstrates the genius behind Apple’s business. Mix in the company’s massive supply chain presence, and the fact that it controls its own distribution channel thanks to its widely successful retail chain, and it’s not hard to see why Apple’s on top.

Speaking of performance, Apple is set to publish its quarterly earnings this Tuesday. The company will also announce the numbers on a conference call that evening around 5PM PST. We’ll be listening in, and reporting back with last quarter’s sales numbers and other interesting info.