If we’re aiming to maximise return for our shareholders, a key objective for us is to minimise the capital deployed as much as possibleGeneral Manager Treasury at CIMIC
Financial solutions such as receivables finance and supply chain finance are helping companies maintain liquidity and keep their operations running smoothly. Receivables finance allows them to use outstanding invoices as collateral for financing, while supply chain finance provides suppliers with short-term credit through the discounted sale of their invoices.
Global contractor CIMIC Group, for example, has used both receivables finance and supply chain finance to optimise its working capital.
In the HSBC survey, more than 20 per cent of finance professionals said receivables collection posed the greatest challenge to their working capital management. To help clients deal with this challenge, HSBC recently upgraded its receivables finance platform and launched its next-generation supply chain platform, bringing its group expertise into the Australian market.
According to Arena, the bank has also invested in making these platforms digitally enabled. “We have launched a mobile phone app called Trade Tracker, which allows clients to track their trade and guarantees transactions on a real-time basis – a first in Australia,” he says.
In its survey, HSBC found that businesses are looking to improve their operations and processes.
From documentation and due diligence to supplier contracts and evaluation, companies must identify areas and processes that can be made more efficient to support working capital optimisation. For example, companies usually need to have high-quality documentation in place in order to access third-party financing solutions.
Embarking on a working capital journey requires significant time and preparation, and there are many potential stumbling blocks along the way. That’s why it’s important to find a partner that can make the process as simple and painless as possible.
“HSBC is a trade bank with over 150 years of experience in this space, and it’s our role to guide you through that process,” says Arena. “We cover more than 90 per cent of global trade flows from our offices in over 67 countries, and in Asia Pacific we have more than 2,800 trade professionals working across 19 markets. Our scale and coverage provide us with a deep insight into the changing nature of trade flows and trends in working capital.”
“For HSBC, optimising working capital means applying the right financial solutions to make the relevant components of your business work towards achieving better operational performance for you, your suppliers and buyers.”