A major disruptive event such as COVID-19 can cause a severe and sudden impact. So, moving quickly to support suppliers, customers and other stakeholders can help a business ensure continuity in its operations.
“Following the onset of COVID-19, supply chains were disrupted. Working capital cycles were stretched, and this impacted cash flows,” said Joseph Arena, HSBC Australia’s Country Head of Global Trade and Receivables Finance.
The global bank saw a double-digit percentage increase in the number of receivables, finance and supply chain transactions processed across the Asia Pacific region.
“COVID has forced many customers to digitise their trade processes and bank interactions,” Arena said.
In the face of global lockdowns, apparel retailer Cotton On assured its suppliers that it would not cancel orders in which raw materials had already been purchased. It even offered to increase the availability of its supply chain finance facility to provide greater liquidity.
“We saw a significant spike in the utilisation of that facility to help them manage their cash flows throughout that period,” Michael Hardwick, Cotton On’s Chief Financial Officer, told the panel.
“We’ve got some relationships with suppliers that have grown with us over 30 years and done a fantastic job for us,” he added. “And we want to make sure we continue to support them and build our business and their business with them as well.”