Did you know that the newly redesigned Sourcing Innovation Resource Site, always immediately accessible from the link under the “Free Resources” section of the sidebar, continues to add new content on a weekly, and sometimes daily basis? Unlike many “resource”, “best of”, or “portal” sites which are abandoned almost as quickly as they are thrown together, the resource site has been steadily adding content and functionality for almost a year now.
In fact, there have been over 150 resource additions in the past week alone, including:
- 38 conferences and seminars, bringing the total number of upcoming events to 257 and
- 27 on-demand training classes, bringing the total number of training options to 82.
This brings the total number of unique, active resources to 1,942, which breaks down as follows:
And with the new site-search page, it’s easier than ever to find what you’re looking for.
Let’s say you wanted to find a live event on “optimization”. Just go to the search page, select the events, and search.
Search Results for ‘optimization‘
Locating trade resources is just as easy.
Search Results for ‘trade‘
Centers of Excellence
So next time you need some information, don’t forget to search the resource site and the blog (using the quick search, which comes in basic and advanced varieties, on the sidebar). You might just find what you’re looking for.
Now that we’re in a credit crunch, articles are cropping up everywhere with “ideas” on how to win more working capital. Some are good, some are not-so-good, and some are downright dangerous. To make sure you know which method falls into which category, I’ve decided to collect the most common “ideas” into one place and categorize them for you, so you don’t have to worry about selecting the wrong method and jeopardizing what might be an already hazardous cash-flow situation.
- Cash-Flow Forecasting
Identify the periods where you will need cash well before they happen so that you can dialogue with your customers, suppliers, and bankers to get you through those periods of cash-negativity.
- Move to More Sustainable Product Lines
Make sure that even if you’re in trouble now and have to “weather the storm” for the next few months, you’ll be in a state of financial health to take advantage of the opportunity when the market comes back — because history will compete and it will come back strong when it does.
- Customer Relationship Management
Understand your customers’ cash-flow situations, when they can pay, and how this will affect you. If they can’t pay on time, and you need cash, you need to know in advance so that you can arrange to borrow against, or sell, the payable. If they can’t pay on time, and you can wait an extra 30 days, agree to treat it as a “cash loan” and charge a fair interest premium. It will save your customer money while improving your future cash situation.
- Inventory Optimization
Inventory costs you overhead. Up to 30% or 35% of the product value. Streamline your supply chain and take out as much inventory as you can. It will improve your cash flow by reducing cost and improve your cash flow by reducing the amount of working capital tied up in inventory.
- Identify Cash-Thirsty Areas
Knowing where you need cash isn’t good enough. You need to know why. If it’s a failing operation or product lines, you need to axe it and refocus on more profitable operations or product lines.
- Focus on the Biggest Projects First
This might sound good in theory, but the biggest projects might not yield the largest cash savings opportunities. If it’s a people intensive project, you can’t just cut people and expect to reduce cash-flow. In the short term, with legal costs and severance pay, you’ll increase cash-flow. Then, when you need to hire them back, you’ll have recruiting costs, HR costs, and ramp-up costs. Sometimes the smaller projects, such as replacing a telecommunications infrastructure when you might be able to save money just be renegotiating a new support agreement with a lower-cost service provider, might have larger savings opportunities.
- Shift Inventory to Suppliers
While VMI is good if done right and implemented up-front (so that products are not produced until needed), forcing your suppliers to hold your excess inventory (without warning) is bad as your suppliers will be counting on your payment to pay their raw material suppliers and payroll, which could worsen their financial situation to the point of bankruptcy.
- Factoring as your Main Financing Strategy
Although factoring sometimes makes sense if you can get a good deal and it will cost you significantly less than a loan, relying on it as your primary fall-back strategy is problematic, especially if a number of your suppliers all of a sudden get their credit worthiness downgraded.
- Extending Days Payable Outstanding Across the Board
If a strategic supplier is hurting, and you’re its largest customer, this might force it into bankruptcy. What’s that going to do to your already ailing cash flow when you have to rapidly switch to a higher cost supplier and expedite shipments?
- Use a Debt Collection Agency
Nothing improves supplier relations like a third party collection agency that will call your supplier everyday and threaten to sue its deadbeat ass off. Just don’t do it.