supply chain finance infographic
DESCRIPTION
Collateral for Platform BlackTRANSCRIPT
www.platformblack.com
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Minimising the risk & cost of Supply Chain disruption
Businesses need to maintain healthy, undisrupted Supply Chains for the good of their own operation. More contracting firms are looking to maintain healthy operation of their supplier
base too as a means to minimise risk of disruption - high up on the list of strategies to nurture Supply Chain health is that of Supply Chain Finance. This infographic looks at the
impact of Supply Chain disruption and how Supply Chain Finance can help.
Symptoms of an unhealthy supply chain
www.achilles.co.uk • www.eurofinance.com • Hamburg Trade and Supply Chain Finance Conference
www.imd.org • www.treasurers.org
of senior decision makers of large corporations admit experiencing severe Supply Chain disruption
agree their risk of disruption is increasing
Repeated supplier underperformance
through delayed delivery, substandard stock, etc.
Errors in predictions and forecasts due to reduced employee performance or a lack of expertise in dealing with the Supply Chain process
Outdated technology – unable to keep up with latest advancements, slowing down processes as a result. Inability to respond e�ectively to IT/Telecom failures.
Increasing demand for goods and services but a lack of working
capital to finance them
Subcontractors asking for expedited payment terms
Suppliers own mismanagement – key suppliers not having e�ective assessments and measures in place to manage crises
A lack of resilience – especially if key suppliers were to be lost
Significant loss of productivity or revenue due to Supply Chain disruption
Absence of full visibility into the whole of the Supply Chain
The Manufacturing sector is hit hard when it comes to Supply Chain disruption.
Large UK manufacturers lost more than £58million dealing with supply chain disruptions in 2013
Average cost of disruption per manufacturer: £105k
Biggest manufacturing Supply Chain disruptor: supplier failure to deliver on quality. Industry cost of
2nd most costly disruptor: supplier failure to deliver on time (industry cost of £17.2million)
3rd most costly disruptor: financial failure of suppliers (industry cost of £7million)
One third of manufacturers experienced financial failure of a supplier in 2013
46% of manufacturers had to pay a financial price for supplier failure in 2013
The scale of Supply Chain Finance model adoption
of businesses surveyed by Aite Group already have a Supply Chain Finance strategy in place
of businesses have a technology platform in place to support the strategy
More than 1 in 4 multinational companies have a Supply Chain Finance programme
of multinationals are planning, investigating or implementing a Supply Chain Finance programme
of businesses considering the setup of a Supply Chain Finance programme feel there is a lack of clarity surrounding who is responsible for it
BUT
What do business leaders agree are the key drivers for setting up a Supply Chain Finance model for suppliers?
Extending payment terms (days payable outstanding)
Standardisation of payment terms
Adding security of supply by supporting the financial viability of the supply chain
Enhancing relationship with suppliers
Good corporate social responsibility practice
3 factors need consideration for successful Supply Chain Finance implementation
CFO Sponsorship
Choosing the right partner
E�cient procurement and working capital management
72%32%
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!?
!
£ ££
!
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Some figures for 2013
£20.4million
£
45%
22%
24%
56%
33%
4%
69%
35% 1/4
36%
Involving at least 60% of supplier base
£
Take control of your supply chain with Supply Chain Finance from Platform Black
No costs to your company: Totally cloud-based, no IT implementation costs for anyone. No legal fees. And no finance charges for the corporate.
Enhance your company’s working capital position and reduce your net interest charge: You have the flexibility to manage your payment terms knowing that your suppliers will remain properly capitalised.
Enhance your return on capital: Your company could generate yield on excess cash by participating in a Supply Chain Finance programme alongside third party investors.
Negotiate better prices and payment terms: Negotiate pricing and payment terms without detriment to your suppliers’ cashflow.
Assist suppliers with working capital management and mitigate risk: Complete assistance helping to mitigate financial risk in your supply chain.
Reward key suppliers for service excellence: Utilise your company’s credit strength to allow your suppliers to get the low costs of finance they need.