Ways Out Of The Working Capital Trap Empowering Selffinancing Growth Through Modern Supply Management 1st Edition Erik Hofmann by Erik Hofmann, Daniel Maucher, Sabrina Piesker, Philipp Richter (auth.) 9783642172700, 3642172709 instant download after payment.

Especially in times of an economic boom following a crisis, companies have to deal with the phenomenon of the "working capital trap," which signifies a company's increasing need for financial liquidity in times of hindered access to debt capital, caused by the increasingly restrictive credit approval processes of financial institutions. As a consequence of cost savings, this situation is often reinforced by a low level of inventory.

This book takes up the problem and shows ways of escaping the "trap" by identifying and strengthening in-house financing potential. First, different operating ratios will be introduced. These refer to the amount of capital committed to the flow of goods and to the amount of in-house financing possible. Subsequently, methods for consolidating in-house financing that are affected by procurement processes will be presented from the company's and the supply chain's perspective.

From a company's perspective, the methods for consolidating the amount of in-house financing over the following topics:

• The Management of Payment Terms

• Inventory Management

• Product Group and Supplier Management

From the supply chain's perspective, the following methods for extending the possible amount of in-house financing will be discussed:

• Finance-Oriented Supply Chain Sourcing

• Supply Chain-Oriented Supplier Financing

• Collaborative Cash-to-Cash Management

• Collaborative Cash Pooling and Netting

• Supply Chain Financing Platforms

The conceptual models will be clarified using a practical example from the automobile industry. Finally, the "Procurement Value Added" (PVA©) approach will be presented, a concept that measures the contribution of procurement to the company's success.