Supply Chain Finance - Optimizing the Financial Supply Chain

Today’s supply chains are characterized by strong linkages between buying and supplying firms in product development as well as production. This results in mutual dependencies and strongly interrelated product, capital and information flows. Improvement potential still exists in the optimization of supply chain finance across the supply chain partners as processes, taxes and cost of capital improvements across the supply chain generate significant savings and lead to competitive advantages. Cooperative supply chain finance approaches - e.g. debt financing support for suppliers - can turn indispensable suppliers to strategic supply chain partners. The identification of strategic suppliers and the selection of an appropriate supply chain finance strategy can be evaluated using the presented supply chain finance matrix. Furthermore, this article provides insights on how supply chain finance can be used to improve holistically the supply chain activities.