boost your bottom line and supply chain health
TRANSCRIPT
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Boost your bottom line and supply chain health
● Introductions
● Working capital management challenges & opportunities
● Improving supply chain health
● 5 “must haves” for a successful early payment program
● About C2FO and Tradeshift
● Q&A
Agenda
Presenters
Rinus Strydom
VP of Alliances
Jordan Novak
Managing Director
Working Capital
Challenges / Opportunities
©2014 C2FO. All rights reserved | 5
“Big Companies Pay Later, Squeezing Their Suppliers”
“European companies lost 350 billion euros in 2014 due to late or unpaid bills”
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Companies are spending like crazy & still generating short-term cash
2010 2011 2012 2013 2014
US non-financial companies cash balance
Buybacks & Dividends
2,000
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
$1,100
$700
($Bn)
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Average rate of return on short-term cash is 20 BPS
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At the same time, long payment terms are beginning to stress supplier balance sheets
Brazil, 75 Chile, 64Germany, 58
UK, 50
USA, 42
Mexico, 71 China, 78 Canada, 42
Source: PWC
Days Sales Outstanding (DSO)
Even with longer terms, companies still struggle to pay on time
Typical incidence of late payment reports by region
Q1 2009 - Q3 2014
Source: ACCA (Association of Chartered Certified Accountants)
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Trying to bridge the gap with credit is becoming harder & more expensive
Average Business Loan Rate for all Companies
Brazil, 27.4% Chile, 9.3%Germany, 4.6%
UK, 3.6%
USA, 3.0%
Mexico, 4.2% China, 7.2% Canada, 3.2%
Source: The World Bank
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Business owners want earlier payments & more control over their cash
Source: C2FO Working Capital Study
Improving Supply Chain Health
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Healthy Supply Chain = Better Business
Source: C2FO Working Capital Study
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Accelerated Payments to Suppliers
● Funds growth and R&D● Strengthens supplier relationships ● Lowers supplier risk
5 Must Haves For a Successful Early Payment Program
1 - Process Automation
Invoice Cycle Time: Ideally <10 days
● E-invoicing ● Automated workflow & approval ● Digitize paper / PDF invoices
2 - Supplier Onboarding
● Digitally connect to suppliers ○ Higher participation in early payment programs○ Transactional transparency
● Ease of communication / education regarding early payment program
● Segment suppliers for more targeted early payment program
● Live support for suppliers
3 - Flexibility for Buyers and Suppliers
● Flexibility of invoice format○ Paper, PDF, e-invoice
● Allow buyer to set parameters on-demand○ Available cash○ Desired APR
● Allow supplier to name their own rate○ Any invoice○ Any time
4 - Being Where Suppliers Already Are
Provide suppliers access in multiple ways, regardless of format
Web
App
Mobile
CloudScan
e-invoice
Mobile
5 - Collaborative & Easy to Use
Tradeshift + C2FO
Tradeshift is a supplier collaboration platform that connects buyers, suppliers, and all their processes in one global network.
We help businesses transform the way they work with suppliers today – and adapt to whatever the future brings.
All Your SuppliersOnboard fast & collaborate in
real time with your entire network.
Powerful PlatformRespond to your growing
business needs with apps on our flexible, open platform.
All Your SpendManage more of your spend
(direct, indirect, services) than ever before.
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World-Class Supplier Collaboration Platform Meets One-of-a-kind Early Payment Marketplace
Procurement AP Automation
Working Capital Solutions
Supplier Managemen
t
Apps
App Platform
Now they offer you discounts directly from the Tradeshift App
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With C2FO, suppliers offer you discounts
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• Buyer sets available cash & desired rate• Suppliers offer their desired rate• Buyer can award every offer if enough cash
Supplier Supplier Supplier
Uniqueoffer
Uniqueoffer
Uniqueoffer
Hotel
• Hotel sets available rooms & desired rate• Guests offer their desired rate• Hotel can award every offer if enough rooms
Suppliers make offers for early payments. Similar to Priceline.com
I have extra rooms I would fill at a certain price
Guest Guest Guest
Uniqueoffer
Uniqueoffer
Uniqueoffer
I have extra cash I would pay early at
a certain price
Buyer
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Our mutual focus on suppliers drives results
* NPS is Net Promoter Score which measures the likelihood to recommend C2FO to another company. 50+ is considered “World Class”.
+
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Key benefits of C2FO + Tradeshift
▪ Faster invoice approvals Tradeshift speeds up invoice processing and approvals. This results in more efficient working caption management.
▪ Higher supplier participation Suppliers can request early payments in the same place they manage invoices
▪ Enhanced collaborationWe’ve combined the early payment collaboration of C2FO with the A/P processing and supplier communication tools of Tradeshift
▪ Greater valueFaster invoice approvals create the highest income potential for buyers and the lowest rate of working capital for suppliers
+A strategic partnership to provide more supply chain value to
you and more affordable working capital to your supply chain
Q&A
Rinus Strydom
Jordan Novak