The Trade Financing Category

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Working Capital Optimization: Why a Game-Changing Approach is Needed

Game changers are easy to spot. They are the ones who want to make sure that tomorrow is better than today. They are the dreamers, the innovators, the ones who think the impossible is a challenge waiting to be bested. And in today’s competitive marketplace, it will be the game changer, more specifically, the financial game changer, who will stand out from the crowd. How will they do this, you ask? They will understand that working capital optimization is so much more than jargon.

Fintech or House Bank for Early Payment Solutions: Key Differences

There are three buyer-centric solutions to facilitate early payment for suppliers: supply chain finance, dynamic discounting and commercial cards (p-cards, v-cards). Bank-developed solutions in this space rely heavily on companies using credit lines. The focal point tends to be on p-card solutions, not dynamic discounting. Why? P-cards generate much more in fee revenue than dynamic discounting, particularly if a client uses its own funds to facilitate early payment instead of a bank credit line. 

Why Platforms and Source-to-Pay Networks Need Finance

More and more procurement software platforms and source-to-pay networks are receiving RFPs from clients requesting way to help improve working capital. Companies, even middle-market companies, have global supply chains. Working capital is important and could manifest itself in the form of yield management, ROI and balance sheet improvement. This is a box on the RFP that vendors need checked. But the path is not easy.

U.S. Companies Improve Working Capital Performance — But Is It at the Expense of Suppliers?

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U.S. companies’ working capital performance is at its strongest since 2008, according to The Hackett Group. However, this is in large part a result of companies shifting their working capital burden on to their suppliers by extending payment terms. The average days payable outstanding in 2017 was 56.7 days, 3.4 days more than in 2016. This data comes from The Hackett Group’s 2018 U.S. Working Capital Survey of the 1,000 largest non-financial companies with headquarters in the U.S.

Best Practice Tips For Implementing Dynamic Discounting and Other Trade Financing Programs [Plus+]

In this Spend Matters Plus analysis, we investigate some of the key best practice tips for dynamic discounting implementation and trade financing programs. In a follow-up post, we will also share “worst practices” that far too many procurement and AP organizations are pursuing with dynamic discounting and trade financing programs because they don’t know better.