supply chain finance infographic

www.platformblack.com

SOURCES:

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Outdated technology – unable to keep up with latest advancements, slowing down processes as a result.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.