GT Nexus is virtually a community of manufacturers, retailers, logistics service providers, carriers, trading partners, and banks working towards improving the pace, ease, and flexibility of doing business globally. Heidi Benko, Vice-President - Product Management at GT Nexus talks about supply chain intricacies in an interview with Fibre2Fashion.com
How can supply chain finance be integrated with both buyers and suppliers?
Supply chain finance can benefit both buyers and suppliers. It is most effective when buyer, supplier and financial institution are connected on a single network that manages the complete transaction lifecycle from purchase order, through shipment, invoice and settlement of the invoice. This level of connectivity enables not only process automation, but also allows for strategic programmes such as early payment programmes, PO and post-shipment financing that help suppliers access to capital when needed throughout the transaction lifecycle and faster.
More importantly, suppliers access capital at better rates than what's available locally. Suppliers are eased of the capital burdens that frequently slow down apparel manufacturers. For buyers, they benefit from a healthier supply chain with less risk of delays. Lower capital costs also impact cost of goods sold, helping improve margins.
How does this linkage work to benefit the entire community?
Capital is essential to the health of any supply chain. When it dries up, business comes to a halt. Linking all parties together and inserting financial services based on data visibility or the financial strength of the buyer or, in this case the performance on the platform (HB- with Seabury it is about performance not the buyer's financial strength) makes it easier for funds to be delivered into the transaction, more frequently and at lower rates. Connectivity also becomes the foundation for collaboration beyond just financing. It opens the door to supply planning and raw materials management. It simplifies amendment processes. It leads to work in process (WIP) tracking and factory automation. All of these processes - when linked together by an underlying platform - allow data to become a competitive weapon for better execution in the supply chain. Unlike other platforms, finance providers are party to the transaction, having full visibility to the transaction lifecycle and to supplier performance history. This helps finance providers help mitigate risks, creating the ability to fund greater volumes and at competitive rates. It enables finance providers to offer programmes such as PO Financing and to create innovative financing programs that not available without a comprehensive supply chain cloud platform and network like GT Nexus.
How easy or difficult will it be for MSME's to implement this technology?
Traditional hosted software can be difficult to deploy. Cloud-based solutions such as GT Nexus are simple. There's no local installation or implementation. A web browser with a secure connection and security standards such as robust encryption processes provide an easy but secure way for smaller exporters to connect and transact.
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