COVID-19: Working Capital Disruption

9 ways apexportal can accelerate early payment programs during a crisis

The Impact of COVID-19 Is Real

Liquidity is under pressure. The timing is right for both buyers and suppliers to leverage dynamic discounting and supply chain finance.

Most companies are seeing changes to their working capital because of COVID-19 and the uncertainty about how the pandemic will evolve. Some companies are seeing a surge in cash while others are having significant cash flow problems. Fortunately, the improvements that many Accounts Payable departments have made in recent years—moving to electronic invoices and payments, AP workflow systems, and offering suppliers online access to invoice status—are a strong foundation to launch dynamic discounting and supply chain finance strategies to ease cash flow pressures.

60%

According to a new Ardent Partners’ study, Procurement Metrics That Matter in 2020, 60% of companies surveyed said the impact of COVID-19 on their supply chains has been significant or extraordinary.

What We Are Seeing in the Market

Organizations that have taken a hit to cash are still offering a discount program to help suppliers, but they are increasingly using third-party funding sources. When using a third-party for funding, the buying organization will either realize a significant decrease or no financial benefit from the discounts captured. This will be paid to the third party as a fee for funding.

Clients that are seeing a large increase in demand for their services have had an uptick in small and medium size suppliers accepting discounts every month as the pandemic goes on. Additionally, several cash rich companies are providing early payments without a discount applied to all of their small and medium size suppliers to further strengthen their relationships.

What Makes apexportal Dynamic Discounting and Supply Chain Finance Different?

With integration to every source-to-pay system, apexportal is the only dashboard that suppliers need to interact with to manage the complete buyer relationship. From supplier onboarding and e-invoicing to ongoing compliance management. One single point of communication creates engaged suppliers to enforce compliance and accelerate procure-to-pay initiatives.