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Calculum Inc
Calculum Inc
Our media pack is available for download and contains the Calculum logos and company information. If you’d like to receive our press releases, organise an interview, and collaborate on a content piece, please contact us.
Current global trade experiences turbulent waters with unprecedented challenges. Disrupted supply chains, geopolitical tensions, and pandemic scars wreak havoc on established logistics networks. Rising inflation and persistent economic uncertainties further complicate the landscape for businesses struggling to maintain financial stability and operational efficiency. Effective working capital management has emerged as a critical lifeline in this turbulent trade storm, equipping companies with the resilience and agility to navigate these choppy waters.
The days of procurement being solely a price negotiation function are long gone. Today, procurement teams are recognized as strategic partners within every corporate organization, driving value creation through optimized sourcing strategies, intricate supplier relationship management, and enhanced efficiency across the entire supply chain. This evolution also extends to the working capital management domain, where procurement plays a pivotal role in unlocking trapped capital by monetizing payables. They can transform unpaid invoices into immediate cash – empowering their company to generate free cash flow, fuel investments in growth initiatives, and strengthen the overall supply chain's resilience.
As environmental, social, and governance (ESG) considerations become increasingly crucial, a unique opportunity arises to integrate these concerns into working capital management. Sustainability-linked early payment programs incentivize suppliers to adopt socially and environmentally responsible practices by tying optimized payment terms to their ESG performance. This innovative approach aligns financial incentives with sustainability objectives, driving a ripple effect of positive impact throughout the supply chain.
Despite the undeniable potential of optimizing payment terms and unlocking working capital, some initiatives fall short of their full potential due to misalignment between treasury and procurement objectives. Siloed operations, with misalignment between treasury and procurement objectives, can often result in initiatives that fail to address supplier needs or align with procurement strategies. Conversely, active collaboration from the outset ensures that programs resonate with suppliers, align with procurement goals, and deliver desired outcomes.
By fostering a collaborative environment, businesses can unlock the full potential of working capital solutions, navigate the complexities of a constantly evolving global economic landscape, and ensure long-term success in a sustainable and inclusive manner.
Data analytics and AI have emerged as game-changers, unlocking the potential of data to enhance liquidity and gain a competitive edge.
These new analytics tools provide solutions to generate free cash flow by focussing on the accounts payable - more precisely on the company’s payment terms with its suppliers. This visibility enables the identification of inefficiencies and areas for improvement of their working capital cycle. Companies can use these insights to compare themselves with their competitors and proactively optimize and negotiate better payment terms, thus improving their working capital structure.
Analytics also helps procurement get better insights into vendor performance and risk assessment. Companies can analyze data to identify important suppliers, identify bottlenecks in the supply chain, and find alternative sources of supply with potential vendors.
Analytics fosters a culture of continuous improvement and adaptability in working capital management. Real-time data and insights allow companies to identify inefficiencies, experiment with new strategies, and refine their optimization approaches. Measuring and monitoring key performance indicators provides a feedback loop for ongoing improvement. Advanced analytics techniques like machine learning and artificial intelligence facilitate dynamic decision-making, enabling businesses to respond swiftly to changing market conditions, optimize working capital allocation, and capitalize on emerging opportunities.
Trade faces major disruptions due to supply chain issues and political tensions. Effective working capital management has become a competitive advantage in this environment, allowing companies to navigate these challenges and stay resilient.
Procurement is no longer just about price negotiation. It plays a key role in optimizing sourcing, managing suppliers, and unlocking trapped capital through monetizing payables.
Data analytics has become a catalyst for procurement, revolutionizing working capital optimization in the era of data-driven decision-making. By leveraging analytics tools, organizations can unlock actionable insights, improve visibility, optimize cash flows, and strengthen supplier relationships, ultimately leading to enhanced liquidity, reduced costs, and a competitive edge.
