Search Results for: sourcing


P2P, Business Networks and Trade Financing: Advance Scenarios

Jason Busch - January 28, 2015 9:27 AM - Available @ Spend Matters

In his recent white paper, “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” my colleague David Gustin offers a number of advanced scenarios and observations that could change the world of receivables and payables financing for good – and for the better. These ideas rely on putting in place new types of B2B infrastructure between companies – no easy feat, mind you! But the possibilities are endless.

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From Letters of Credit to Approved Invoice Financing

Jason Busch - January 27, 2015 9:55 AM - Available @ Spend Matters

Letters of credit (L/C) are a traditional financing and risk management tool often used in cross border trade. As a primer on them, my colleague David Gustin writes in a recently published paper, “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” that “when suppliers don’t offer open terms, traditional trade finance payment instruments like letters of credit (L/C) are typically used, especially in international trade.”

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Creating a More Sustainable Food Supply Chain, But at What Cost? (Waste Matters! Part 8)

Kaitlyn McAvoy - January 27, 2015 6:22 AM - Available @ Spend Matters

How do we make the supply chain more sustainable? What changes can we implement to reduce the amount of wasted food? While businesses are clearly losing money either overbuying or underselling their food products, efforts to make changes to the supply chain cost money, too. Would that cost travel down to the consumers? That’s something else businesses need to think about. And would consumers be willing to pay extra for food products from a store that practices sustainable practices?

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Beyond the Approved Invoice: How B2B Networks Can Enable Event-Triggered Trade Finance

Jason Busch - January 26, 2015 9:56 AM - Available @ Spend Matters

From a financing perspective, having an approved invoice from an investment grade corporation is the equivalent of having an emotionally intelligent and highly responsible son or daughter graduate from Harvard Business School or Wharton. The combination of factors is a strong predictor of a successful financial outcome in the future. But few of our children will achieve all of these elements together – the same is true of all of the individual triggers available for trade financing as well.

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Beyond Invoice Discounting and Dynamic Discounting Alone: 6 Triggers for Receivables and Payables Financing

Jason Busch - January 15, 2015 6:42 AM - Available @ Spend Matters

I sometimes tell people that we’re in the top half of the first inning, with the lead-off hitter on plate, to describe where we are in the evolution of purchase-to-pay (P2P), supplier networks, business networks and trade financing. And the first pitch we’ve tossed to the plate is the approved invoice (net of dilutions) as the trigger for online-driven financing. This is the premise behind financing-centric network and e-invoicing providers like Tungsten and Taulia. But e-invoicing is only a single trigger...

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Beyond Approved Invoices: Using a PO to Trigger Financing

Jason Busch - January 22, 2015 10:03 AM - Available @ Spend Matters

While invoice discounting is getting nearly all of the attention today at the intersection of P2P, business networks, supplier networks and trade financing, might a purchase order (PO) actually be a better event trigger? The answer, if you can mitigate risk, is: absolutely. Financing off a PO allows, in theory, a significantly greater term over which to finance (and gets cash into the hands of suppliers more quickly).

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Jeremiah Was NOT A Bullfrog!

Guest Contributor - November 6, 2014 1:31 PM - Available @ Spend Matters

Spend Matters welcomes a guest post from Art van Bodegraven. Fans of the innocent earlier days of popular music might remember the monster hit “Joy to the World,”by Three Dog Night. But an earlier Jeremiah was a prophet in the Kingdom of Judah, the "weeping prophet" who urged reform and repentance. He is recognized in Judaism, Islam, Christianity and Baha'i. Some think that I might be modeling Jeremiah, but my own views are not quite as pessimistic.

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The Irony of Globalization and Trade: Declining Capital Availability and Financing

Jason Busch - January 1, 2015 2:14 AM - Available @ Spend Matters

With globalization and increased trade flows, could available credit and capital to fuel global supply chains actually be declining? It almost sounds impossible. But financing needs have not kept up with booming global trade between countries, raising risk in the supply chain and creating situations that favor larger suppliers over smaller ones.

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Everything You Thought You Knew About Taulia and Tungsten is Wrong

Jason Busch - January 16, 2015 2:45 AM - Available @ Spend Matters

A bunch of folks on the Spend Matters analyst team have collectively spent thousands of hours in the past year digging into the intersection of receivables financing, payables financing and purchase-to-pay (P2P). We’ve explored vendors from all sides, including Taulia and Tungsten. Read on to hear the "myths" and the reality behind these two companies.

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EDI Failures: Why Advanced Ship Notifications Are Limiting Trade Finance

Jason Busch - January 14, 2015 6:28 AM - Available @ Spend Matters

Electronic Data Interchange (EDI) remains the lifeblood of corporate supply chain data flows today. Indirect business networks and e-invoicing networks, such as the kind proffered by Ariba, Basware, Tungsten and others, are tiny by comparison in terms of documents and dollars changing hands. Yet EDI isn’t perfect. Advanced ship notifications (ASNs) is one area where EDI still comes up short, especially as a system of record and trigger for trade finance. In his recent white paper, “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” my colleague David Gustin provides a number of reasons why the ASN has not become a reliable trigger for financing, especially compared with approved invoices.

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Why Are Financial Supply Chains Not Keeping Up With Physical Supply Chains?

Jason Busch - January 13, 2015 6:18 AM - Available @ Spend Matters

Financial supply chains and global capital flows are highly complicated. So, too, are physical supply chains. Yet the way cash flows around the globe is actually quite antiquated compared to the flow of goods and materials (and the information trail that can enable better procurement and supply chain management compared with trade financing). In the white paper, “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” my colleague David Gustin captures this idea when he notes that, “In many industries, the financial supply chain has lagged behind the advances made by the physical supply chain by a decade.”

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Invoicing Discounting, Dynamic Discounting and Self-Funded Corporate Programs

Jason Busch - January 12, 2015 6:06 AM - Available @ Spend Matters

Self-funding has been the primary mechanism to date for corporations to fund invoice discounting and dynamic discounting programs (which explains, in part, why Taulia has been growing so quickly, since they started this model). But how do companies self-fund invoice discounting programs? In a recent white paper, “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” my colleague David Gustin explains how self-funding programs work in practice.

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Waste Matters! (Food Waste, That Is)

Kaitlyn McAvoy - November 21, 2014 6:22 AM - Available @ Spend Matters

How much food do we waste in America? A lot: 30% to 40% of the food supply ends up in the landfill. In 2010, 133 billion pounds of food was thrown out at retail stores, restaurants and US homes. Today Spend Matters begins a new series on the food supply chain, the amount of food waste we produce and what is being done about it. We think it’s timely, too, as the holidays approach. We will take a look at this important issue gaining national attention and what it means for procurement and the supply chain.

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What Does Dim Weight Have To Do With Me?

Guest Contributor - November 12, 2014 2:35 PM - Available @ Spend Matters

Off in the nether regions of dirty fingernails supply chain execution, practitioners are leaving work early to stock up on sackcloth and ashes. Oh, the wailing, the gnashing of teeth! It is as if a plague of Biblical proportion had been loosed upon the people. The proximate cause of the hoopla and furor has been the announcement by UPS and FedEx of dimensional weight (dim weight) pricing for its commercial customers. Stripped of all the anti- rhetoric and pro-smooth talking, what dim weight comes down to this is: A parcel of twice the cubic size of another will cost twice as much to ship.

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Anticipatory Sourcing: Anticipating What, And When

Guest Contributor - October 30, 2014 2:15 PM - Available @ Spend Matters

Spend Matters welcomes a guest post from Art van Bodegraven. When I use the term Anticipatory Sourcing without setting the stage fully and correctly with an audience, even an audience of one, the reaction is eerily reminiscent of the late and much lamented Richard Pryor exclaiming, "Say what?!?!?" (Shades of the cult classic film, “Stir Crazy.”) But, at the risk of offending and alienating, I will stake out the position that, unless you are doing anticipatory sourcing, you are taking up valuable space that ought to be occupied by someone more motivated, more aware, more understanding and, possibly, even a bit more intelligent.

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Improving Contractual Flexibility – The Difference Between Success and Failure (Article 2)

Guest Contributor - October 25, 2014 8:20 AM - Available @ Spend Matters

Spend Matters welcomes this guest post from POD Procurement, a business consultancy that created the POD model. To achieve the maximum savings, buyers need to commit to procuring the goods/services from the suppliers. Once the contract has been awarded, both parties focus on delivery. If the business requirements reduce post-contract award it can lead to a difficult business decision.

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The Difference between Success and Failure (Article 1)

Guest Contributor - October 18, 2014 8:22 AM - Available @ Spend Matters

Spend Matters welcomes this guest post from POD Procurement, a business consultancy that created the POD model. In our 3-part series we will explore these 3 core areas of achieving procurement success: Centralized Procurement (Article 1), Improve Contractual Flexibility (Article 2) and Encourage and Reward Post-contract Supplier Innovation/Efficiency Gains (Article 3).

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How Your Suppliers Borrow Money: The Evolution of Relationship Lending and Business Networks

Jason Busch - January 5, 2015 10:25 AM - Available @ Spend Matters

Suppliers can borrow money in multiple ways. From lines of credit to mezzanine funding, to convertible debt, the vehicles to access capital are complex and broad. Yet in just about all cases, the origination costs are quite high for different parties involved. As my colleague David Gustin observes in his recent paper “On-Demand, Event Triggered Finance With Network Models – A Game Changer?,” “sourcing deals, underwriting credits and approving/monitoring credits is time intensive and expensive.”

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Centralized vs. Decentralized Procurement: Technology as (one of) the Great Governance Disrupters

Jason Busch - September 26, 2014 2:43 AM - Available @ Spend Matters

In procurement, we often look at technology as an enabler. For example, sourcing optimization technology can change how we source by allowing us to gather an increased set of data points from suppliers (and then apply our own constraints to understand how various biases or requirements create additional supply chain cost, such as requiring higher inventory levels, not awarding to the lowest bidder, etc.). Yet technology can enable more than just tactical activities like sourcing – it can also help redesign how we structure procurement teams and leadership to begin with.

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Local Sourcing and Localized Supply Chains for Magma and the Automotive Industry

Jason Busch - September 5, 2014 6:30 AM - Available @ Spend Matters

Auto News recently reported that Magna International, one of the top three auto suppliers based in Canada, has been rethinking its supply chain of late, noting that “local strategy and efficiency improvements as key cost-saving measures within its supply chain.” In particular, supply chain localization was one of three trends within Magna’s supply chain identified by Carrie Van Ess, vice president of procurement for the Americas, at a recent industry briefing. Van Ess said a new supply chain model is emerging in which “goods are produced, sold and consumed in the same geographic region,” according to the article.

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