We’ve worked on a number of Working Capital Improvement and Management Projects over the last 15 years – one working capital chemical industry project that we were involved in focused on 3rd Party Accounts Receivable for a Global Food Quality Chemical Manufacturer.
Global AR Reduction
Company – Global Food Quality Chemical Manufacturer
Project Description – Working Capital Project with a focus on 3rd Party Accounts Receivable
Location – Global
Working Capital Issues
- High AR in most countries
- Overdues high in most countries
- Long Payment terms in most countries
- A widespread belief that reducing terms with existing customers will lead to a loss in sales (metal model)
JustOne Actions Undertaken
- Visited Holland, Brazil and USA and produced reports and targets for each
- Trained 7 Internal Consultants (ICs)
- Led a pilot facilitation in Chicago with all ICs in attendance
- Supported the ICs who implementation the project during 2007 and 2008
Benefits
- The ICs facilitated the change in all parts of the world
- Common processes and procedures in place
- Common leading practice methodologies adopted
- Mental models regarding terms reduction changed
- Accounts receivables were reduced by 28%
- Reductions in Overdues and significant reduction in payment terms in some countries
Client Testimonial
Comment from the FD of the company: “Even in the current challenging economic climate we have maintained the gained improvement from the project” – CFO and Sponsor