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Working Capital Insider: SCF Today – Why Customers Are More Engaged Than Ever

 

By • Published June 23, 2020 • 5 minute read

In this Working Capital Insider™ video interview, VP Customer Advocacy for the Americas Matt Doorley explains why it’s more important than ever to invest in your supply chain finance program. From optimizing working capital in the face of disruption to making sure suppliers have access to the cash they need to keep pace, now is the time to consider expanding your program.

Tom Roberts:

Welcome back to another Working Capital Insider video. I’m Tom Roberts. I’m the Global Head of Marketing for PrimeRevenue and today I’m joined by Matt Doorley. Matt is our VP of Customer Advocacy for the Americas. Matt, who joined PrimeRevenue in 2012, works incredibly hard with our customers to make sure that they’re well taken care of and that their programs continue to grow and thrive. So, Matt, thank you so much for taking the time to talk with me today.

Matt Doorley:

Hi Tom, I’m glad to be here.

Tom Roberts:

So obviously given the global pandemic and all the disruption of business around the world that’s unprecedented, what are you hearing from clients about what’s happened to them given the health crisis as well as the economic crisis that’s resulted from that? How’s it impacting the business?

Matt Doorley:

Sure. So we have the fortunate opportunity to talk to many clients across different sectors. One sector that’s doing actually well is food and beverage retailers. Their supply chains are operating at near or full capacity, which is requiring their supply chains to operate at optimal levels. We also have sectors who aren’t doing so well. A couple of examples of those are automotive and oil and gas – those sectors are dealing with a significant reduction in demand or they’re dealing with temporary plant closures, which is putting pressure on their supply chains because of the lack of demand or even plants running. So both those scenarios though, do result in a huge need for liquidity.

Tom Roberts:

Talk to me a little bit more about that. Given all the liquidity options that these large organizations have access to, where does supply chain finance fit in that spectrum and how do they think about that versus their other options?

Matt Doorley:

It’s the priority and the focus on supply chain actually has increased dramatically. There’s a couple variables that support that. One is the pricing. These are very efficient, low cost programs that can be offered to the suppliers. The programs have been around a long time. So we think about stability and longevity, which is very important because if you’re going to offer this source of liquidity, an alternative source of liquidity to your suppliers, it has to be stable and it needs to be around for them to use it. And then the third one is just ease of use. It doesn’t take forever to get access to this liquidity. Offering the program and onboarding the suppliers is quick and easy.

Tom Roberts:

I know from working with you on a number of clients and just in general overall clients that you support, many of them are expanding their programs dramatically and trying to do it very rapidly, some with hundreds of suppliers and some with thousands of suppliers. How do you go about a joint action plan to be able to execute against that and what are the challenges and what are the lessons that you’ve learned?

Matt Doorley:

There’s really three key themes that we’re engaging our customers on to help them with their business. One of them is improving working capital. There’s two levers that we’re helping them with. One is payables – we’re trying to help them optimize their payment terms and offer an alternative source of liquidity to their suppliers. The other one is receivables, where we’re helping them put together a portfolio of their customers and then put a receivables financing solution together. So that’s on the working capital side. Another thing is cost reduction – our customers are focused on improving margin. Then the third one is enhancing or protecting and sustaining their supply chain. So that example I made earlier about industries that are struggling and that are just trying to figure out ways to help their supply chains survive, this fits that category where we’re trying to get the program out so those suppliers have another source of liquidity.

Tom Roberts:

Great. Matt, thank you so much for taking the time to talk to me about all of this. I really appreciate it. And for those of you watching, thank you so much as well for taking the time to watch, please check www.PrimeRevenue.com or our resources section for more content like this, as well as follow us on LinkedIn. We’re publishing a lot of content about global trade finance and what we’re seeing overall. Thanks very much. Take care and be safe.