The Challenge
One of India’s leading pharmaceutical companies wanted to transform the way their supply chain operated.
They had over 1500 suppliers, with 30-90 day credit periods.
The Client had strong cash reserves earning subpar returns in risk-free instruments. Standard cash discount program only covered a small segment of spend base.
The Solution
CashFlo set up a comprehensive implementation and program management structure with the Client. CashFlo setup and lead a cross-functional Project Management Office (PMO) and rapidly executed vendor onboarding.
A multi-pronged vendor success program was set up. Starting from a deep vendor segmentation and tailored onboarding experience for different segments, and growing into virtual workshops and webinars to incentivize adoption.
“We have seen great success on the CashFlo model. We had initial reservations on adoption among our vendors but are happy that our vendors have found this helpful. The program helps us generate 2x+ returns on our treasury funds without any effort.”
– CFO
The Result
This project achieved adoption levels never seen before in the pharmaceutical industry, and new categories of suppliers who had never been able to access Invoice Discounting in the past were now activated on the platform.
The specific benefits to the client were two-fold:
- Procurement cost was rapidly reduced, often as much as 2% for certain categories. This was achieved primarily through high adoption and resulting financial health in the supply chain, reducing cascading price increases.
- Return on treasury was improved by nearly 2.5X compared to earlier investment vehicles. Of note here, since adoption had been ahead of expectations, treasury returns were also achieved ahead of plan.
