Financial supply chain management is the practice of looking at all the financial processes at the holistic level, rather than viewing them as individual processes.
The term "Financial Supply Chain" refers to the monetary transactions between trading partners to facilitate purchasing, manufacturing, and selling of goods and services. It is also sometimes used generically to describe a broader range of supplier financing solutions, including solutions like dynamic discounting, in which suppliers can receive early payment on their invoices. Financial supply chain reduces the risk of supply chain disruption and enables both buyers and suppliers to optimize their working capital.
The financial supply chain management is made up of three components: the procure-to-pay cycle, working capital management, and the order-to-cash cycle.
Financial supply chains are important as it can bring stability and flexibility to these supply chains by bringing the lowest cost of capital to where it is needed most in the supply chain to shift focus from survival to improving efficiency, innovation and investment in new products.
Financial supply chain
