[ Gentle music plays ] Just quickly about the alignment of the management. So as I mentioned earlier there are some key roles which you have to kind of consider when you set up a program and everybody has to be involved. He is the Treasurer, procurement, the top C-level management like the CFO, CEO, CTO, the accounts payable team which issue the payments to the bank accounts of the funder and other parties which I will explain later and then here you see again who are the initiators or who is starting such initiatives, mainly it's the Treasurer, sometimes it's the CFO and then who is rolling out, who is implementing these kind of solutions and managing on ongoing basis is a Treasury, procurement, sometimes finance director, sometimes it's it's on a local basis so the local Treasurer, it depends on the size and also how decentralized the company is being set up. So again the Treasurer he is he is responsible for the liquidity risk management, for the cash management and yeah today almost every program starts with the treasurer and he's also he makes the selection of the platform. So he will define if he wants to go with a non-bank platform or if he wants to work with his relationship banks in their own platform and if you see here this is a survey which was done like Kyriba, so they asked like how much time for the Treasurer is spent in terms of improving his working capital and about 75% his work, of course, is focusing on working capital on the incoming cash flow and the outgoing cash flow. So this is a top priority for them and for them supply chain finance or all the publications focusing on Treasurer, supply to finances top topic. Today if you speak with a Treasurer of large companies you can be sure they know supply chain finance, they heard about it and here you see on the other statistics from Deloitte what are the key challenges for a Treasury is basically how to repatriate cash. So if you have cash if you're a global company cash leak-- located in different jurisdictions, how you bring that together. Then of course, the liquidity the fourth one and inadequate systems inadequate payment terms, so supply chain finance also helps you to to kind of streamline and have similar payment terms across the supplier board. Another important topic just came to my mind before you know when we discussed dynamic discounting you know where you have a supplier and you have the buyer and the buyer uses his own cash platform his own cash to fund the supplier you know, so it's his own cash. The problem is like on paper it looks like okay there's one buyer, but you have here let's say if we have Nestle, so you have Nestle US you have maybe Nestle US 1 US 2 US 3 correct, then you have Nestle Sweden, Nestle Finland, Nestle Poland okay you don't have everywhere the same amount of cash right, like in Europe mostly cash is maybe in Switzerland, most of the cash is in Netherlands, but if this is the buying entity in Sweden, how you move the cash from here to there? It's a big issue, so if you have this type of programs Nestle Sweden wants to pay a supplier in Sweden you don't have the cash, this can be quite complicated when you deploy such dynamic discounting or self-funded program. This is other statistic, so for what the CFO is mandating or putting his priority on the Treasurer department, so you see here on a statistic it's the first one is liquidity. So how to manage liquidity in the liquidity risk and how to have access to capital to finance growth. So to finance grows you have different opportunities, it's like you go through the equity market which is the most expensive cash inbound or you can just get financial liability, you know through financial debt, you raise debt which is not very good for your balance sheet kind of metrics and you leverage and you also look at the risk the risk management of how you manage your your cash flow in terms of long term and short term. So all this plays together into setting up supply chain finance programs as a Treasurer. Then procurement they play a key role because they are responsible for the search-- sourcing the purchasing of the goods and the services from all the suppliers and also managing the relationship with the suppliers and also managing the risk of these suppliers going out of business or being able to provide you the goods and services even when you grow very fast, so or helping you with new product launches new developments of new products and their key role is to negotiate volumes, negotiate pricing with the suppliers and the general conditions in terms. So they play a key role, I mean they're mostly they're are not pushing for supply chain finance program because they kind of they see it as a negative effect on their suppliers when payment terms are increased. They don't see the second benefit that it always also provides early payment terms for the suppliers, but they need to be included early in the sales process that they understand the benefit and what it means for the global objective of the company like long term objective or strategic objectives like acquisition, mergers and in most cases yeah they don't like they're they are very strong negotiating the best pricing, but they are not very comfortable in negotiating terms payment terms. So for that it's very important to really educate them early in the supply chain finance initiative in the stage of the initiative and to support them, and for them I mean they don't care so much which bank is funding or which pricing, for them their care more about who can support them who can kind of help them with negotiating of of terms with the suppliers, selecting the right suppliers. So this is more the important aspect for them. Then the other roles, so I mentioned earlier the key point is to have the blessing and the support from the CFO and the CEO top management that they really set up the goals top level like we want to have let's say half a billion worth of cash flow in the next 12 months, so that must be a top priority, so that everybody knows that this is not just like a small initiative. This is a key target of the company. Then the accounts payables and IT teams, so they are the accounts payable team they are responsible to issue the payments and depending if as I as I discussed many times before if you have here the buyer and the supplier the supplier doesn't have to ask for early payment okay. So if he ask for a repayment the accounts payables team okay they pay the bank on day 60, correct? Because the bank paid them on day five, but now as I said the supplier doesn't have to choose to get paid earlier. If the supplier says," Like you know what I don't care this month I don't need it or I have already my own financial arrangements I don't need it," then the accounts payable team has to be informed at a platform nobody asked for it and then they pay on day 60 the full amount. So depending on you know, you can also make it more complicated [Voice: Once the buyer plugs into the system it's legally binding so why doesn't the bank just pays the supplier why does the buyer has to go...] because because this this selection let's say day five, it's not obligatory it's an option, they can choose it, they can choose day 10. They can choose they just want to have they want to get paid $30 on day five, they want to get $10 on day 10 and the rest the rest is $60, they don't want it. They want to get paid on day 60 [Voice: So they want that full amount right?] So no in this case they have to pay $40 on day 60 and the bank is advised to pay on day five $30 and on day 10 $10, correct? But they're missing the $60, they have to pay supplier because the bank only paid $40 so why they should pay now $60 because then the bank has suddenly more money than what what they paid. So you see it can be then quite complicated, which invoices have been sold? Which-- you know who should I pay? So for the accounts payable team they're really looking at the system and mostly how it works is basically the buyer they have a cash management account or cash account where basically in this account the platform tells this account hey this amount you pay here this amount you pay here this amount you pay to the supplier, this cash management account triggers all the payment. You don't want the accounts payable teams manually have to decide where to pay. So it's why the accounts payable teams is looking very carefully at how it is managed, and of course, for the IT team they want to have a simple system, how they can integrate their ERP system with the technology platform. They are also looking at the risk of the technology platform, you know is it is the data mirrored to other kind of other servers? Where the data located? What is the the underlying technology? So it's very important for them and then the last group are the controllers, the accounting department or the internal audit. So they are looking at the beginning, they look if in terms of the accounting treatment in terms of the balance sheet treatment, if this is favorable or it if it bears some risk for the buyer when the external auditors are looking at that, which I will explain little tomorrow [Voice: So back to this flowchart...the buyer is only paying the funder from the platform $40 of the 100 correct?] Yeah because look [Voice: And then they decide to pay 60...] because here this is early this is early, this is mature this is normal. That means here the bank pays $10 at day 10 and $30 at day five, correct? To the supplier, so this is $40 this went out of the pocket from the funder. So why should he receive now $100, he only paid out $40. That's why the buyer pays out $40 on day 60 and is $60 on day 60 goes to the supplier, but they are looking for system which can I really like okay these are mangoes here these are mangoes here and now you have to and this again this is very simple simplified here you can have multiple funders, here you have thousands of suppliers in different currencies different countries. So you have different cash account systems for different currencies. Do you have to trigger all these payments? And everything has to be automated and then you have to reconcile at the end and that's why I early today I mentioned like the technology platform or you mentioned that is important yes it's important because the principle is simple, you know you can do that with Excel on a piece of paper, but if the volumes are increasing it's impossible. You need technology which can handle that efficiently.