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PwC
PwC Global Treasury Survey ’17 - Strategic goals for the CFOs
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“Companies are coming around to the notion that they need a comprehensivebalance sheet strategy […] thinking about the tradeoffs that come with differentbalance sheet configurations and how to prioritize them in light of theirbusinesses and particular value creation strategy”
Source: PwC Global Treasury Survey 2017
Source: ALM Intelligence Competitive Landscape Analysis – Corporate Finance & Treasury Management Consulting (Nov 2016)
PwC
Balance Sheet Management Framework
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Immediate Cash Benefits
Long Term Financial Flexibility
Sustainable Capital Allocation
Long Term Cash Improvements
• Effective banking & cash management
• Enhanced global cash & liquidity visibility
• Accuracy of cash forecasts and reporting
• Improved ability to fund and support operations
• Freed-up cash to pay down debt
• Improved ability to select higher ROI projects
• Improved ability to achieve capital budgets
• Optimal capital structure• Increased enterprise agility
& flexibility• Reduced borrowing costs
Cash & Liquidity
Management
Capital Optimisation
Working Capital Management
Corporate Finance Strategy
PwC
Balance Sheet Management drives Profitability as well as P&L does
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Companies that maintain a strong Balance Sheet efficiently fund their operations andgenerate sustained cash flow growth, are best positioned to face unexpected events andcapitalize on business opportunities.
Goals for the Finance function partnering the Business:
Goals for the Finance function partnering the Supply Chain Higher company
valueLower cost
of debt
Higher returnsBetter credit
standing
PwC
The PwC SCF Barometer - Introduction
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The Supply Chain Finance Barometer
Goal
Questions
Respondents
Goal of the surveyUnderstand the current position and awareness of SCF and implementation drivers & critical factors
Respondents’ profiles• +60 respondents, global view • Variety of industries & size• Diverse range of functions• Varying levels of SCF maturity
Key questions• Key SCF implementation drivers?• SCF program scope? SCF technology used?• Total spend covered by the SCF program?• Supplier onboarding?• SCF success rate?
PwC
Reasons for implementing
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Principal reasons for implementing an SCF program
Working Capitaloptimization
Supplier liquidity needs
Supplier relationship improvement
Other• Additional revenues, cost reductions• Utilise cash surplus• Optimize corporate finance (incl.
Asset financing)
Supply chain stability improvement
SCF in place Interest in SCF
46%
18%
18%
12%
6%
45%
14%
14%
14%
12%
PwC
Where SCF in place - Supplier selection criteria
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Strategic relationship and spend amounts are
key drivers for suppliers’ selection
PwC
Implementation time of SCF Solution and Initiator
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SCF initiator - 2017
period between signing the contract with the SCF provider till processing the first invoice on the platform
Respondents used external support for all phases of a SCF implementation, including:
• business case assessment• legal/contract review• IT implementation• supplier on boarding• project management
PwC
When SCF not effective? What our experience has shown
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• All or the majority of the spending is with Suppliers who have a credit standing better than the Buyer
• Buyer’s Finance and Purchasing Departments do not share common objectives and have divergent interests/incentives
• Price setting is ownership of the Purchasing Dept. and a “no-fly zone” for the Finance Dept. (for Dynamic Discounting)
• Cash is not an issue for the Suppliers, so reducing the payment terms is not a priority
• Little effort dedicated to the Suppliers’ onboarding initiatives
PwC
BAROMETERThere is an increasing awareness over the past few years, driving appetite for introducing or extending SCF solutions
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PwC
Download a copy of our PwC SCF Barometer2017 ….
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…and reserve a copy of our coming PwC SCFBarometer 2018 at our Desk!
ThanksThis publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, [insert legal name of the PwC firm], its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.
© 2018 PwC Advisory SpA. All rights reserved. In this document, “PwC” refers to PwC Advisory SpA which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity.
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