Removing Your Cash Flow Blindfold

Removing Your Cash Flow Blindfold

Maintaining cash flow visibility is a struggle for many businesses across the supply chain, especially for those that deal with complex rebates and trading programs. Why? Many businesses don’t have a sufficient level of visibility into their data and lack transparency in their trading relationships. Misaligned data, disparate systems, poor communication and a lack of transparency between trading partners makes tracking and managing your cash flow a toilsome and time-consuming process.

Supply chain partnerships are at their strongest when based on transparent collaboration and clear communication, allowing for maximum cash flow visibility, more efficient processes and improved trading program performance.  

So, how can businesses remove the critical cash flow blind spots that are holding their teams, trading partners and rebate programs back?  

In this blog, we’ll show you how to identify these problems, gain visibility into your data and build transparency with your trading partners.

Recognizing Cash Flow Blind Spots

The first step in removing your cash flow blindfold is to assess your processes for finding silos, blind spots and other points of obfuscation. This can be difficult because it’s hard to know what you don’t know.  

Sit down and think about your processes. Look for gaps.

Common causes of cash flow blind spots include:

  • Poor and infrequent communication
  • Insufficient analytics
  • Data and information silos
  • Inefficient collaboration
  • Disparate reporting systems
  • Misalignment on partner goals
  • Lack of collaborative reporting and analytics features (via portals or dashboards)

These are symptoms of larger problems that commonly occur within and between businesses. Now, let’s take a deeper look at some of the other issues that often cause these blind spots.

Internal Visibility into Data

Cash flow visibility is an internal as well as an external issue. This means that barriers to visibility, such as information silos, exist both within teams and between trading partners.  

On the internal side of the issue, businesses seem to lack critical resources for tracking and measuring their cash flow, as well as the effectiveness of their trading programs. Just over 40% of manufacturers either don’t have internal dashboards or don’t know if dashboards exist, leaving teams misaligned and reliant on redundant communications. Many manufacturers also believe that their analytics capabilities are holding their trading programs back, with 42% in agreement that better analytics would help program effectiveness.

A lack of internal visibility can also be attributed to information silos, internal misalignment and a lack of communication. 44% of distributors told us only purchasing and senior management are familiar with their rebate programs. When critical parts of the business are hidden behind oblique barriers – rather than shared and aligned with the team – confusion, communication delays and errors are inevitable. Think of it like adding more players to a game of Telephone – the more players, the longer it takes and the more opportunities for misunderstanding along the way.

Transparency with Trading Partners

Cash flow visibility is an all-too-common problem for distributors in buying groups, 57% of which report not knowing the rebate amount earned from each manufacturer. Currently, more than half of manufacturers don’t provide their customers with dashboard analytics, and only 9% have on-demand reports available for their customers via a portal.

This ambiguity isn’t just impeding cash flow visibility; it’s weakening trading relationships and preventing manufacturers from maximizing the potential of their rebate programs. With 75% of distributors in agreement that knowing rebate amounts would influence their support of a manufacturer, increasing visibility is a huge area of opportunity for businesses across the supply chain to strengthen both their trading programs and their strategic partnerships.

Communication has also emerged as a key issue in cash flow visibility. When cash flow data is not centralized in a shared database, businesses are forced to rely on time-consuming manual communications. This is an all-too-common problem for businesses across the supply chain; 36% of distributors reported receiving poor communication or only receiving updates until they receive their payment. Similarly, 1 in 3 distributors only receive updates on their rebate programs when they ask for them and without adequate information.  

To improve cash flow visibility and strengthen our trading relationships, we must rebuild our partnerships and processes on strong foundations of clear communication, aligned collaboration and data transparency.

Supporting Cash Flow Visibility with Collaborative Software

Many businesses have turned to collaborative solutions such as rebate management software to support better cash flow visibility with their trading partners. There are several ways that businesses can leverage software to improve cash flow visibility:

Accurate forecasting

For businesses seeking a clear and reliable view into their cash flow, accurate forecasting is a must-have feature. Maintaining a reliable forecast of rebate payments that are due in the coming months will allow you to plan ahead and prepare for any potential cash flow shortfalls.

Some rebate management systems feature automated and intelligent forecasting to make your projections easier, faster and more reliable.

Real-time tracking

Businesses should always have an up-to-date view of their cash flow, including rebate payments. Real-time tracking allows businesses to quickly identify any discrepancies or delays in rebate payments. This can be achieved by implementing an automated rebate management system that supports data integration.  

Collaborate with trading partners

Work closely with your teams and trading partners to develop a strong collaborative relationship. You should communicate your priorities regarding transparency, collaboration and alignment. Establishing these expectations early on and seeing them through are among the best ways to maintain productive and reliable collaboration.

Centralizing data with a single source of truth

Avoid ambiguity, conflict, communication delays and data silos by removing the source of the problem: a reliance on busy (and often forgetful) people. By centralizing data in a transparent collaborative system, both parties have access to the cash flow data they need, when they need it. No more waiting around for an update, no more costly misalignment – just seamless, clear collaboration.  

By implementing an automated and collaborative software solution, you can improve cash flow visibility within your teams and transparency with your trading partners. Don’t hold your collaborative potential back by allowing your teams and partners to fly blind; consider implementing a software solution, such as the Enable platform, to always keep your trading programs and cash flow in view.

Ready to make a change? Download our white paper to learn how you can replace your legacy system with a rebate management platform.

Lane Ledesma

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