The Working Capital Forum
  • Home
  • Events
  • Latest
  • About
  • Login / Register
  • Working Capital Award Winners 2022
  • Home
  • Events
  • Latest
  • About
  • Login / Register
  • Working Capital Award Winners 2022
Search


​FEATURES

How Twinco Capital's founders are stretching the boundaries of supply chain finance in developing markets - and where ESG fits in

28/2/2023

 
Unique is a much-abused adjective, but it can justifiably be applied to two former bankers who are on a mission to lengthen the chain of supply chain finance, writes Paul Golden
​

In a market as large and established as supply chain finance it is hard to imagine how there could be any opportunities yet to be exploited. But six years ago, Sandra Nolasco (former head of structured trade finance at BBVA) and Carmen Marín (a 16-year veteran of Santander) decided that large corporates needed help offering their suppliers access to affordable funding at a much earlier stage of the process.

Despite their banking backgrounds, they are scathing of the approach banks have taken to supply chain finance.

“The traditional approach has been to fund just the tail end of the trade flow, when the supplier has delivered the goods and there is an invoice which has been accepted by the buyer,” says Nolasco (right).
​
All this is doing, she suggests, is funding the payment terms of large corporates.

​​“The biggest component of the funding requirement is the production process – buying the raw materials, paying employee salaries - and this is all borne by the supplier.”
Picture

Read More

​The Baltics start to open up to the potential of SCF

5/1/2023

 
Picture
While factoring is ubiquitous in the region, there is still work to be done to convince the Baltic market of the benefits of buyer-led supply chain finance, says Uve Poom, COO at SupplierPlus in Talliinn.
​
By Rebecca Spong
​

The Baltic states of Estonia, Latvia and Lithuania are still lagging behind other European regions in their awareness and use of supply chain finance (SCF) as a means of improving a company’s working capital position.

While well-versed in the benefits of traditional factoring as a means of suppliers accessing early payment for their goods, the region has not yet been fully embraced the idea of a buyer-led supply chain finance solutions, says Uve Poom (right), chief operating officer at the Tallinn-based Supplier Plus. ​


Read More

Why supply chain finance providers are relaxed about regulation - despite continuing fallout from Greensill

21/11/2022

 
Picture
FASB Regulations: No impediment to SCF
Greater regulation is coming to supply chain finance, but the market will still need those prepared to speak out to prevent financial scandals, writes Rebecca Spong
 
The downfall of Greensill Capital last March dragged the niche financial product of supply chain finance on to front pages around the world – mixed up with stories of political intrigue and the owner Lex Greensill’s questionable connections to senior members of the UK government.

​This week, more than a year and a half later, 
Liberty Steel, a division of Indian-British steel giant GFG Alliance, finally announced that it had reached a debt restructuring deal with creditors of Greensill.

With the Greensill affair rumbling on in the background,  the US Financial Accounting Standards Board (FASB), issued new rules coming into force next month which call for greater transparency on how supplier finance programmes are being used. It will make it easier for those looking at company accounts to see the impact of programmes on working capital and cash flow.

Read More

Supply chain must be central to business strategy conversations

25/10/2022

 
Understanding the connection between supply chains, finance and business strategy is increasingly vital for CFOs as recession looms.

By Rebecca Spong
Picture
Chief financial officers must place supply chains at the heart of their business strategy, urges Bram Desmet, professor of operations and supply chain at Vlerick Business School in Belgium.
With the aftermath of Covid, the energy crisis and the war in Ukraine all contributing to a looming recession, companies need to have a clearer idea of how their supply chains support their wider company goals, he says, ahead of his keynote address at the Working Capital Forum Europe to be held in Amsterdam in December.


Read More

Webinar report: Receivables Finance at Knorr-Bremse

20/10/2022

 
Picture
Picture
Why did Knorr-Bremse, a German manufacturing and services company with a 'rock-solid' balance sheet and no immediate need for additional financing, put in place a receivables finance solution?

The answer, according to Rainer Gerstung, Senior Manager Corporate Finance & Treasury, was to be ready for whatever shocks the post-Covid economic climate might bring. In a classic case of 'fixing the roof while the sun shines' the firm wanted to have access to additional funding in place before it might need it.

Watch the Webinar >
Gerstung decided to work with CRX Markets, whose working capital platform integrated smoothly with the firm's existing SAP ERP, allowing multiple banks to compete to fund individual debtors made available for financing by the firm. 

Tim Kallenborn, Head of Sales at CRX Markets, pointed out that all the funding banks had agreed to sign the same Master Receivables Purchase Agreement (MRPA), which hugely simplified the arrangement. While the Knorr-Bremse programme is funded by banks, CRX Markets  has also brought specialist non-bank funders into similar programmes for other clients. 

​For Knorr-Bremse, recievables finance forms part of an integrated working capital strategy which also includes reverse factoring. For Gerstung, its great benefit is optionality - Knorr-Bremse may not need the extra liquidity today, but it has the facility to scale up its factoring very quickly should markets conditions worsen.

Rainer Gerstung and Tim Kallenborn were speaking at the latest online event from the Working Capital Forum. You can watch a recording of the webinar here.

How Coca-Cola uses SCF to help cut carbon emissions

17/10/2022

 
Picture

​Supply chain finance can be a useful tool in encouraging sustainability throughout your supply chain, says Anthony Breach, head of procurement at Coca-Cola EuroPacific Partners (CCEP). 
​

Anthony BreachBreach: Speaking at Working Capital Forum Europe
By Rebecca Spong

The company behind one of the best-known soft drink brands has turned to supply chain finance (SCF) as one way to help hit its carbon emission reduction targets.


Coca-Cola EuroPacific Partners (CCEP) teamed up with Dutch bank Rabobank this year to create a supply chain finance programme that not only aims to offer its suppliers a cheaper source of funding, but also encourages suppliers to reduce their environmental impact. 

Targeting Net Zero by 2040

The soft drinks company has a target to hit net zero carbon emissions by 2040 and reduce greenhouse-gas emissions across its value chain by 30 per cent by 2030. Creating an SCF programme that incentivises suppliers to behave in a more sustainable way is just one tactic Coca-Cola has implemented, says Anthony Breach, director of procurement at CCEP, speaking ahead of his presentation at the Working Capital Forum in Amsterdam in December.   

“We are one of the most recognised brands on the planet and have a responsibility to act as a corporate citizen. We’ve set out a clear ambition to reach net zero by 2040… we cannot do that without our suppliers. We have to have our suppliers on the journey. We’re already asking them to switch to renewable electricity and set science-based emissions reduction targets and this is another way for them to join us by encouraging and recognising their efforts,” says Breach. According to CCEP, more than 90 per cent of its carbon emissions can be attributed to its supply chains. 

“I am not going to pretend it is the panacea that fixes everything - it is just one small additional tool in our toolbox to help suppliers to start that carbon journey – some are well on the way, and some aren’t,” he adds. 

Preferential Rates

Under the programme, suppliers can access preferential financing rates depending on to what degree they reach certain environmental targets. Coca-Cola is benchmarking its suppliers against ratings created by the independent sustainability ratings agency EcoVadis. 

Suppliers can choose to set their carbon reduction initiatives by 2023 in line with the Science Based Targets Initiative (SBTi) - a global coalition of agencies that shows companies and banks how much they need to reduce their carbon emissions to minimise the worst impact of climate change and align with the goals of the 2016 Paris Agreement signed. 

Or they can commit to ensuring they use 100 percent renewable electricity across their operations by 2023. Committing to both action plans would unlock even better financing rates, says Breach. 
Some targets will be easier to reach according to the industry the supplier is operating in, he explains. Having a range of different KPIs ensures the programme attracts a wider range of suppliers.
Rabobank will also donate part of the commercial margin to a project run by Rabo Foundation, the bank’s social impact fund. 

Coca-Cola is far from a newcomer to supply chain finance with existing programmes already in place, however, Breach explains how the company wanted to upgrade some of its previous offerings to create something easier to use, accessible to more suppliers and with the added benefit of improving Coca-Cola’s environmental credentials. 

Suppliers at the heart of the programme


What was imperative to the process was ensuring that suppliers were “at the heart of the programme,” says Breach. “Every supplier had to benefit. Why would they transfer if they were going to be worse off?”
The rates offered to suppliers had to be better than the rates they were currently on, Breach explains.
It also had to be a simple process to join, noting that Rabobank had a “very light touch KYC process” making it straightforward to onboard suppliers. 

All suppliers – regardless of size – are invited to join the new SCF programme in contrast to previous models, which placed a financial limit on participants. Equally, suppliers on any type of payment terms – whether they are on 30-day or 100-day terms – are welcome to join, Breach adds. 

“There are no working capital targets set as part of this programme,” he emphasises, explaining that suppliers did not face any extension in payment terms directly related to the new programme. 
“It is purely about how we can improve the service offering we already have with suppliers,” he says. 

“It is difficult out there for suppliers and consumers, so if we can reduce our environmental impact and reduce the cost of financing for our supplier base by leveraging our credit rating then let’s do it.” 
To date, the new programme is progressing well, says Breach. “Onboarding has been straightforward, and suppliers have come to us asking to actively join the programme,” he says. 

The process has been aided by underlying technology in place that allows Breach to have instant access to the latest up-take figures. “I couldn’t do that with previous programmes. I was in the dark about how it was performing until I got the results every month. It was very static data,” he says. 

The new programme was initiated in Germany in June this year, and CCEP has now begun its rollout in the Iberia region. The company is planning to launch the programme in Asia-Pacific this November, replacing an existing under-utilised programme in Australia. 
​

The expansion into Asia-Pacific follows CCEP’s acquisition of the Australia-headquartered Coca-Cola Amatil last May which brought together the European and Asia-Pacific bottling companies together under one entity. 



Anthony Breach, director of procurement at CCEP, will discuss the company's ESG supplier finance programme at the Working Capital Forum in Amsterdam in December.  Places are free of charge for corporate treasurers and procurement directors.  To reserve your place, Click here.

New York Round Table Report: Managing Working Capital in Challenging Times

7/10/2022

 
Picture
Picture
How are corporate treasurers managing working capital in an era of inflation, rising interest rates and supply chain shocks? The Working Capital Forum assembled a group of treasury and procurement leaders under the Chatham House Rule at New York’s Soho Grand Hotel to answer this question. 

Our guests included large and mega-cap firms in the FMCG, pharma, retail, technology, manufacturing and media spaces, and representatives of Taulia and SAP, our lunch sponsors for the day. While the individual challenges faced by treasurers differed, four distinct themes emerged that were common to all.

Which cash is king?

There was no dissent from the universal view that liquidity - cash - is more important than ever in an uncertain economic environment. However, one supply chain finance specialist in the group pointed out that, these days, the phrase ‘cash is king’ might need modification to ‘which cash is king? Short or long-term, USD or other currencies, in an era of rapid change, understanding the cash position, now and in the future, remains a priority.

Without exception, every treasurer present was focused on increasing the accuracy of both short and long-term cash forecasting - arguably the starting point for every conversation about working capital. Few around the table were satisfied with their cash forecasting process and several were actively looking for new technology solutions in this area.

One treasurer had developed processes and implemented systems to make the best of a notoriously inaccurate science. Her firm had implemented a technology solution which had eased the process of gathering data from multiple sources to feed into the daily forecast. Another idea was a daily ‘cash call’ at 10.30 am, which was open to any executive to join. 

Pull as well as push for supply chain finance

The focus on cash is not limited to those at the top of the supply chain.  Smaller suppliers, who may only have one banking relationship, are at the mercy of rising interest rates. As one guest put it, ‘We have a conversation with our banking partners, but our smaller suppliers just get an email.’ Those firms are seeing the cost of cash rise and often have far fewer alternatives to whatever rate their bank will offer.

The result has been a sharp increase in interest in whatever supply chain finance (SCF) is on offer. Several guests reported that, for the first time, they were taking incoming calls from suppliers asking about SCF,  rather than having to persuade them to take it up.

Reporting requirements

If there was one potential brake on the use of supply chain finance as a tool to optimise working capital and support suppliers, it was the new reporting requirements issued by FASB last month.  From December 2022, companies will be required to report their use of supply chain finance programmes in sufficient detail, ‘To allow a user of financial statements to understand the programme’s nature, activity during the period, changes from period to period, and potential magnitude.'

No one felt that this change would dissuade them from using a properly structured supplier finance programme. Instead, they would look to their SCF provider to build the proper reporting into the platform. Reassuringly, Taulia representatives mentioned a tool already under development, which would be ready for the December deadline and which would provide the required data ‘in seconds’.

The accidental treasurer

For the first time at a Working Capital Forum round table (which has been running since 2015), the problems of attracting and managing talent were raised by several in our group. One had built links with a university to source new talent. 

Others noted that the job description for ‘treasurer’ is changing. Where once a Certified Treasury Professional (CTP) qualification was both expected and sufficient, today, a wider grasp of technology and business is seen as a definite plus - and conventional treasury qualifications may not always be essential. One firm has a policy of rotating new staff between departments, including treasury, so that often people with no previous understanding of the discipline realise how central to the business - and how interesting- treasury could be. 

The role of treasury is expanding, too. Our media guests we very focused on consumer-to-business payment channels, understanding how they are changing and what they mean for cash management. Where once accounts payable (AP) was left to shared services, for companies with a strong reliance on subscriptions, treasury needs to be a participant, not a spectator, in selecting and managing payment channels.

Five ways to thrive in challenging times

As the meeting came to a close, guests were asked for their own recommendations for any treasurer looking to guide their businesses through today’s stormier business environment. We’ve distilled their answers into five points to remember:
  • Think about building your treasury team: look for ways to bring in fresh talent from outside the conventional treasury channels - often people better fitted to a more open, outward-facing future.
​
  • Set targets and develop robust KPIs around numbers such as Days Payable Outstanding (DPO). Be transparent about those targets and encourage wider company buy-in through initiatives like a daily ‘cash call’.
​
  • Be laser-focused on liquidity, both short and long-term: Are your funding and your credit lines adequate for whatever comes?
​
  • Embrace technology: Cash forecasting and SCF reporting are two examples, but active working capital management, especially in challenging times, requires technology beyond an Excel spreadsheet, however well-structured.
​
  • Be prepared for bad debt; as interest rates rise and inflation increases, customers may suffer. Is your cash position strong enough to withstand a major customer being unable to pay?

As always, the real value of the round table meeting was in the 'off the record' exchanges between peers before and after the formal session. 

​These issues will be revisited at future Working Capital Forum events, including our European conference in Amsterdam on 1st December


The end of optimisation? Working capital in a crisis

27/5/2022

 
Picture
Our first round table in London since 2019 almost ended before it began. As our diverse group of treasury, corporate finance, and procurement leaders began to describe the supply chain issues they were facing, more than one revealed that their policy for the moment was to, ‘Forget about working capital.’  Not, thankfully, because it was no longer a concern, but because of the vital importance of securing increasingly scarce supplies of everything from grain to microchips, paying what the market demanded, and carrying inventory in far greater quantities than would have been thought wise in the old days of ‘optimisation.’ 
​
​
Picture

Read More

Five working capital must-haves to weather the economic storms: Stockholm round table report

12/5/2022

 
Picture
As a small group of treasury and procurement leaders gathered in Stockholm’s Grand Hotel for the first ‘in person’ Working Capital Forum round-table for almost three years, UK Prime Minister Boris Johnson was also in town. He was there to pledge support to Sweden and, later Finland, as they prepared to apply for NATO membership - a reminder that conditions in Europe are anything but ‘business as usual’. 
​
​
Picture

Read More

Why companies with a strong ‘cash culture’ are better prepared for economic turbulence: Round table report

27/1/2022

 
Picture
Today I moderated a virtual round table for corporate treasurers for our Working Capital Forum networking group. ​

Read More

How the global pandemic has changed working capital priorities: Round table report

29/11/2021

 
Picture
The latest meeting of the Working Capital Forum saw treasury leaders from several major retail and FMCG firms gather around our Virtual Round Table. ​

Read More

The future of working capital: reporting from Working Capital Forum London

14/10/2021

 
Picture
​The first live Working Capital Forum event for over two years took place at the Waldorf Hotel in London’s West End on 14th October 2021. The event has brought together more than 100 treasurers and working capital experts to discuss the latest themes, challenges, and keys to success in working capital.

Read More

Ten steps towards setting up a successful cash pool - Round Table Report

24/9/2021

 
Picture
Cash pooling offers clear advantages to businesses that want to make cash ‘trapped’ in subsidiaries available at the group level. ​

Read More

Webinar report: ‘Don’t get left behind,’ industry warned in race to digitise trade finance

26/5/2021

 
Picture
Banks and corporates must keep an “open mind” and embrace new digitised platforms to secure the future of trade finance.

Read More

Round table report: Simplicity is key to supplier onboarding for SCF programmes

21/5/2021

 
Picture
The May round table meeting for the Working Capital Forum saw treasurers from seven multinationals gather to discuss ways of encouraging supplier take-up of supply chain finance programmes, in a meeting sponsored, as usual by American Express.

Read More

Round Table Report: Centralise for SCF success, say treasury and procurement leaders

26/4/2021

 
Picture
Bringing disparate entities together in a centralised treasury or shared service centre can be a positive step along the road to better working capital management. ​

Read More

Round Table Report: How internal charging for stock can help boost working capital

4/3/2021

 
Picture
The latest round-table meeting of the Working Capital Forum, supported by American Express saw eight senior treasurers gather online to discuss ways of getting ‘buy-in’ to working capital optimisation programmes.

Read More

Webinar report: Funding supply chains for recovery in a post-Covid world

14/7/2020

 
Picture
Communicating with suppliers, buyers and finance providers is more essential than ever in a crisis. That was the unanimous conclusion of the speakers in the latest Working Capital Forum online meeting, Funding supply chains for recovery.

Read More

Webinar: How the Covid crisis has accelerated Accounts Payable automation

4/6/2020

 
Picture
More than one-third of corporations have accelerated their plans for automating their accounts payable function during the Covid-19 pandemic, according to a poll taken during the latest Working Capital Forum online meeting.

Read More

Webinar: Supporting your smaller suppliers in a time of crisis

16/5/2020

 
Picture
The coronavirus lockdown has exacerbated the problems faced by smaller business in getting paid, said the UK’s Small Business Commissioner, Philip King, in the latest Working Capital Forum online meeting. ​

Read More
<<Previous
WORKING CAPITAL FORUM
FEATURES
NEWS
EVENTS
AWARDS
CONTACT
​admin@workingcapitalforum.com
© ADAUGEO MEDIA LTD 2023
​​PRIVACY POLICY
  • Home
  • Events
  • Latest
  • About
  • Login / Register
  • Working Capital Award Winners 2022