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Visa International Release Financial Flows & Supply Chain Efficiency White Paper

Tuesday 8 March 2005 11:23 CET | News

New report from Visa International and Stanford University professor recommends integrated electronic payment systems for improvement of financial flows in supply chain systems.

Visas Financial Flows & Supply Chain Efficiency, white paper outlines the benefits of linking financial flows and supply chains to increase overall business efficiency. The paper, sponsored by Visa International and authored by Professor Warren H. Hausman of Stanford University, was released at Visas annual Multinational Council event, which is attended by a network of Visa banks that offer Visa payment and information management solutions to meet the needs of multinational corporations. The paper focuses on the current state of financial flows and supply chain efficiency, noting that the two systems have developed independently over time, with improvements in financial flows trailing behind those in supply chain management. Unrealized savings exist in the supply chain system because many current systems do not adequately address the financial flow, but instead focus on the flow of goods. Visas commercial payment systems address this divide by providing a convenient bridge to other sectors of an organizations operations, resulting in benefits for their overall business. Visa Commercial Solutions offer businesses cost-effective ways to address the supply chain and financial flow inefficiencies identified by Professor Hausmans research. Because such solutions are poised to provide major improvements, making financial flows faster, more reliable, more predictable and less costly, Professor Hausman recommends that organizations evaluate their current processes to better understand how automated payment tools can enhance operational performance and increase profitability. Payment system solutions to inefficiencies include: - Purchasing accounts: P-cards make purchasing more efficient and cost-effective and allow companies to collect spend data quickly to help enforce compliance and to negotiate vendor discounts. They also increase overall financial transparency. - Distribution accounts: Distribution accounts assist in streamlining accounts receivable processes, transforming collections into quick, paperless electronic payment, thereby reducing costs and improving reconciliation significantly. - EIPP: EIPP (Electronic Invoice Presentment and Payment) allows for quick, error-free information transfer and reconciliation of shipping receipts, invoices and corresponding purchase orders. In addition to the benefits outlined above, these innovative payment solutions contribute to improved supply chain performance metrics, as financial flow key performance indicators have a direct correlation to product supply chain performance metrics. For instance, P-cards, distribution accounts and EIPP may result in reductions in both accounts receivable and accounts payable for companies in the supply chain.


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Categories: Payments & Commerce | Payments General
Countries: World
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Payments & Commerce