What Is Financial Supply Chain Management?

　　 What is? Financial supply chain management

The so-called financial supply chain management refers to the management of orders, documents, checks and payments from customers to all transactions related to capital flows to the seller. The enterprise manages the purchase and financial transaction process from order to settlement in a safe and transparent way, so as to optimize cash flow, better manage the working capital of enterprises and improve the utilization ratio of funds.

　　 Contents of financial supply chain management

The essence of financial supply chain management is the integration of financial management and supply chain management.

The basic idea of supply chain financial management is the close integration and exchange of information between logistics and financial activities, so as to achieve cost savings and create value for shareholders.

　　 from theory Above analysis:

On the one hand, logistics information can be obtained from the relevant logistics supply chain, so cash information can also be obtained from the relevant financial supply chain, increasing the source and transparency of the cash, thereby reducing the instability of cash management and ultimately reducing the total cost of enterprises.

On the other hand, funds are scarce resources, and the funds of an enterprise are limited. However, the external financing of enterprises is relatively difficult. Enterprise managers and decision-makers hope to track and analyze the sources of expenditures, costs and profits in a timely manner, so as to reduce the cash flow of enterprises, improve the operation and management of enterprises, and ultimately reduce the cost of products. As a result, some Financial Services Company quickly launched the function of financial supply chain service, introduced the concept of financial supply chain to cash management, and "financial supply chain management" came into being. {page_break}

　 Purpose of financial supply chain management

The main objectives of financial supply chain management are to reduce working capital, improve working capital management, improve inventory transparency and enhance service level.

　 The role of financial supply chain management

The main functions of financial supply chain management are operation control and inspection, decision / strategy support and daily financial transactions.

　　 Financial supply chain management Importance

A famous international supply chain management company has conducted a survey on the financial supply chain. The survey shows that the main results are: supply chain is critical to the success of the enterprise, the specific supply chain operation is not consistent with the company strategy, the importance of the supply chain and its actual performance are different, the control of the supply chain is incomplete, the main objectives are cost control and customer service, the company's supply changes are very difficult, and the awareness of the financial supply chain is increasing.

At present, people generally use the process of supply chain analysis value chain analysis operation chain analysis cost driver analysis to find the opportunity of cost reduction. It is undeniable that in the process of cost reduction, it can play a very good role, and can avoid the change of one link in the supply chain leading to the increase of cost and efficiency of the whole value chain. But repeatedly using the cost analysis process and the cost control tools such as activity based costing and target cost method, the potential of cost reduction has little room, and the financial management which integrates capital flow, information flow and material flow can further tap the potential of cost reduction.