Key Takeaways
- Evoqua’s supply chain finance program, in partnership with iFinTok, empowers suppliers through early payments, fosters sustainable relationships, and generates significant cash flow for Evoqua.
- The program’s expansion and high supplier participation demonstrate its value in addressing suppliers’ financial needs and creating a mutually beneficial partnership.
- Evoqua’s innovative approach to supply chain finance, recognized by the 2019 SCF Awards, highlights the alignment between sustainability, financial resilience, and strategic growth.
In the realm of water technologies, Evoqua Water Technologies stands tall as a beacon of innovation and sustainability. Their commitment to environmental stewardship extends beyond their core business, reaching into the intricate web of their supply chain. Through a strategic partnership with iFinTok, Evoqua embarked on a supply chain finance journey that transformed their financial landscape, fostering sustainable relationships, empowering suppliers, and generating a tidal wave of cash flow.
Navigating the Currents of Sustainability
Evoqua’s sustainability goals are deeply ingrained in their corporate DNA, guiding their every decision. The supply chain finance program emerged as a natural extension of this ethos, aligning seamlessly with their commitment to ethical and environmentally conscious business practices. By embracing early payment programs, Evoqua extended a helping hand to their suppliers, enabling them to thrive and contribute to a more sustainable supply chain ecosystem.
Early Payments: A Lifeline for Suppliers
Evoqua recognized the financial struggles faced by many suppliers, particularly small and medium-sized enterprises. By implementing the supply chain finance program, they offered a lifeline to these businesses, providing early payments around day 10 after invoice approval. This financial empowerment allowed suppliers to manage their cash flow more efficiently, invest in growth, and navigate economic uncertainties with greater resilience.
Cash Flow Surge: A Financial Windfall
The impact of the supply chain finance program on Evoqua’s cash flow was nothing short of remarkable. Within six short months of implementation, the company witnessed a surge of $21 million in cash flow, a testament to the program’s effectiveness in unlocking hidden liquidity. This financial windfall provided Evoqua with the flexibility to pursue strategic initiatives, invest in research and development, and expand their global footprint.
Expansion: A Ripple Effect of Success
The resounding success of the supply chain finance program prompted Evoqua to expand its reach across various business units. The program’s coverage grew exponentially, encompassing over $400 million in spend and engaging more than 330 targeted suppliers. This expansion not only deepened Evoqua’s relationships with existing suppliers but also attracted new partners eager to reap the benefits of early payments and streamlined financial processes.
Supplier Participation: A Vote of Confidence
The overwhelming participation of suppliers in the supply chain finance program served as a resounding endorsement of its value. An impressive 72% of suppliers actively traded invoices, while 25% enrolled in the Auto-Trade feature, demonstrating their trust in Evoqua and their commitment to a mutually beneficial partnership. This high level of engagement underscored the program’s ability to address suppliers’ financial needs and foster a collaborative environment.
Reinhold Zeiner’s Perspective: A Visionary Leader’s Insight
Reinhold Zeiner, Senior Director of Finance and Shared Services International at Evoqua, expressed his unwavering support for the supply chain finance program, emphasizing its alignment with the company’s business philosophy and core sustainability values. He lauded the program’s contribution to Evoqua’s financial resilience, strategic acquisitions, and overall success.
Strategic Acquisitions: A Catalyst for Growth
The supply chain finance program played a pivotal role in facilitating Evoqua’s strategic acquisitions. By aligning payment terms with industry standards and generating free cash flow for funding, the program empowered Evoqua to seize growth opportunities and expand its global presence. This financial agility enabled the company to acquire complementary businesses, diversify its product portfolio, and solidify its position as an industry leader.
Global Recognition: A Well-deserved Accolade
Evoqua’s groundbreaking achievements in supply chain finance garnered global recognition at the prestigious 2019 SCF Awards. The company’s innovative approach and unwavering commitment to sustainability earned them the coveted “Best Supply Chain Finance Program” award, a testament to their leadership in this rapidly evolving field.
Working Capital Optimization: A Strategic Imperative
Evoqua’s focus on working capital improvement served as a cornerstone of their supply chain finance strategy. By strategically aligning payment terms and generating free cash flow, the company gained the financial flexibility to pursue strategic acquisitions and fund ongoing operations. This optimization effort enabled Evoqua to maintain a healthy financial position, mitigate risks, and seize opportunities for growth.
Bonus: A Glimpse into the Future
Evoqua’s supply chain finance journey is far from over. The company plans to further expand the program by onboarding additional business units and suppliers, extending the reach of its positive impact. This expansion will not only enhance Evoqua’s financial resilience but also contribute to the sustainability and growth of its entire supply chain ecosystem.
Evoqua’s success story serves as an inspiration to other companies seeking to transform their supply chains into engines of sustainability and profitability. By embracing innovative financial solutions, fostering supplier relationships, and aligning business goals with environmental stewardship, organizations can unlock a wealth of opportunities and create a positive impact on the world.
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