In a challenging year for companies involved in international trade, it has never been more important to unlock your working capital tied up in your procurement process.
Supply chains are being stretched to breaking point as buyers look to delay payment terms in order to preserve their own working capital. Yet by looking towards your supply chain as a source of liquidity it is possible to optimize your cash conversion cycle, deliver faster payments and ensure the viability of your suppliers for the future.
Unlock working capital
The cash conversion cycle is often neglected as a metric that indicates the efficiency of a firm’s operations. Calculated by adding inventory days and days sales outstanding, both assets, minus the amount of days payables outstanding, a liability, it measures how long input is tied up in production and sales before it is converted into cash received.
The shorter your cash conversion cycle is, the better. Harbor’s supply chain finance program is able to deliver fast payments to your vendors, while also offering you lengthened payment terms.
“Our supply chain finance program eliminates credit terms discussion during negotiation with suppliers by offering sight payments, at the same time optimizing the buyer’s accounts payable terms and cash conversion cycle,” said Bryan Maloney, president of Harbor.
Strengthen your supply chain
It is apparent that small and medium sized suppliers are the first to feel the effect of a financial crisis and are now starved of working capital. Globally, suppliers have been struggling as payment terms are being renegotiated across industry segments, implementing a supply chain finance program with sight payments can ensure their survival.
Supply chain finance allows you to unlock hidden liquidity within your supply chain and boost free cash flow. Simultaneously, the program supports your global vendor base by offering accelerated payments. Securing a resilient supply chain enables you to deliver products when others cannot, leveraging opportunities to satisfy customers and create new business, leaving those with a fragile supply chain at a competitive disadvantage.
Harbor’s technology has been created with streamlining processes and decreasing costs associated with financing in mind. Onboarding is quick and efficient, while the implementation of artificial intelligence has helped to automate labor-intensive processes, saving you time and money. The platform and programs are agnostic in terms of industry and geography. Invest into your own supply chain with Harbor.