Driving Working Capital Op1miza1on from AP - rather than Treasury

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Phebe Tucker
8 years ago
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1 Driving Working Capital Op1miza1on from AP - rather than Treasury

2 Agenda Introduc1on of Basware Where s Treasury How AP Makes a Difference Unlocking New Value Streams

3 Basware: Our Company

4 Basware: Our Solu1ons

5 WHERE S TREASURY

6 Treasury Treasury Ac1vi1es Treasury Areas Cash & Liquidity Management Banking Credit Management Policy & Proceedures Systems & Repor1ng Processes People & Culture We don t have a Treasury Department Risk Management

& Proceedures Systems & Repor1ng Processes People &

7 Accounts Payable AP Ac1vi1es Accounts Payable Areas Invoice Handling Payments Supplier Interac1on Archiving, Audit, Repor1ng Payment Invoice workflow / approval Data entry / pos1ng Invoice Recep1on & Intake We re very opera1onal

Audit, Repor1ng Payment Invoice workflow / approval Data

8 The Overlap 46% of treasury departments that act as internal consultants to other departments* Accounts Payable Treasury Cash & Liquidity Management Banking Credit Management Analy1cs Supplier Enrolement P- Card programs Payment programs Source: *afponline.org/benchmark.

Liquidity Management Banking Credit Management Analy1cs Supplier

9 AP AUTOMATION SUPPORTS WORKING CAPITAL OPTIMIZATION

10 Best in class AP KPIs Cost per Invoice Invoices per FTE Cycle 1me $14.21 $2.42 Best in class Best in class 12,4 days 3,7 days Best in class Source: Ardent Partners: epayables 2014: The Quest

42 Best in class 27700 57700 Best in class 12,4

11 Best in class AP KPIs Excep1on rate Share of suppliers sending e- Invoices Share of suppliers par1cipa1ng in discoun1ng programs 13,1 % 8,0 % Best in class 14,8 % 40,3 % Best in class 9,9 % 17,2 % Best in class Source: Ardent Partners: epayables 2014: The Quest

13,1 % 8,0 % Best in class 14,8 % 40,3 % Best in class 9,9 % 17,2

12 How best in class performers do it? PROCESSING Two or three- way matching capabili1es Standardized AP processes Measure key AP metrics Automa1cally route invoices for approval Process invoices straight- through Linkage throughout the P2P process Match invoices to contracts or payment 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% All others Best in Class TECHNOLOGY ADOPTION 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Document imaging/scanning Automated rou1ng and approval workflow e- Invoicing solu1on Supplier Network (B2B network or payment All Others Best in Class Complete Procure- to- Pay solu1on Dynamic discount solu1on Source: Ardent Partners: epayables 2014: The Quest

through Linkage throughout the P2P process Match invoices to contracts or payment 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% All others Best in Class TECHNOLOGY

13 How best in class performers do it? PAYMENT AND ENGAGEMENT Access to web- based supplier portal 0% 10% 20% 30% 40% 50% 60% Efficiently capture early payment discounts Tools/programs to op1mize working capital All others Best in Class Suppliers update all their informa1on online Supply chain finance program Source: Ardent Partners: epayables 2014: The Quest

Efficiently capture early payment discounts Tools/programs to op1mize working capital All

14 And yet, research tells us... 48% More cash on hand 74% Live with late payments 69% Processes block discount capture 1000 companies in EU, US, APAC 90% *Survey: Crea1ng Payment Energy Late payments have negasve impact Buyer Supplier

15 Drawing a red line Treasury AP Networks Payments E- invoices Process Automa1on Beker Working Cap Mgnt.?

16 UNLOCKING NEW VALUE STREAMS

17 Take control of your financial supply chain 17

18 How much value is locked in your supply chain? 18

19 Key elements of your financial supply chain Assurance Payment Funding

20 Tradi1onal payment programs fall short... Early Pay Discounts Cost Spend/Supplier Coverage Ease of Use Dynamic DiscounSng Cost Spend/Supplier Coverage Ease of Use P- Cards Cost Spend/Supplier Coverage Ease of Use Reverse Factoring Cost Spend/Supplier Coverage Ease of Use

Dynamic DiscounSng Cost Spend/Supplier Coverage Ease of Use P-

21 Why do they fall short and what is the common denominator? Buyers (DPO) How do we reduce fric1on? Suppliers (DSO) Payment Payment FricSon

22 B2B Networks a prerequisite What does it mean? BASWARE COMMERCE NETWORK 80 million transacsons Invoicing is consolidated Buyers & Suppliers connect 1,000,000 buyers and sellers 100 countries 500 Billion USD NETWORKS PARTNER Suppliers are engaged Payment programs scale Working capital strategies scale FINANCIAL AGILITY FINANCIAL AGILITY

23 Network finance is about scale & agility

24 Networked financing services Discount Advance Pay Invoice Financing Receivables Basware Commerce Network Financial Engine Assurance epayments Payables New InnovaSons Payment Funding Dynamic Discount

25 Flexible payment and funding op1ons for buyers and suppliers

26 Enabling AP with just in 1me financing E- invoices E- invoices Payments Payments Suppliers (Receivables) Buyers (Payables) 26

27 THANK YOU QUESTIONS?

NEW MODELS FOR SCF THOMAS FAKHOURI BASWARE FINANCING SERVICES

NEW MODELS FOR SCF THOMAS FAKHOURI BASWARE FINANCING SERVICES SUPPLY CHAIN FINANCE THE WORKING CAPITAL OPPORTUNITY Today s supply chain finance solutions typically: Offer access to advantageous financing