Elena M.’s Post

"As the role of the accounts payable function continues to evolve, AP leaders are increasingly prioritizing initiatives that will help them pave the way to a smarter future. According to Ardent Partners’ annual State of ePayables survey, AP’s top priorities for 2023 include improving reporting and data analytics, enabling more suppliers to submit invoices electronically, implementing AP automation, eliminating paper and reducing manual tasks, minimizing processing costs, and improving collaboration and communication with procurement. ‘Implementing AP automation’ (36%) and ‘eliminating paper invoicing and reducing manual tasks’ (35%) were also identified as key priorities for AP leaders in 2023. This reflects a clear recognition that manual processes are time-consuming, error-prone, and costly. As such, many AP teams are exploring automation solutions that will help reduce the amount of paper and manual tasks being managed today." - Andrew Bartolini Yes, we can help: https://lnkd.in/dWt9Vit7 https://lnkd.in/dpABVsBe

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I'm asked frequently if, within our "Freight OS" vertical at Linkt, we're a "managed trans" provider or a "broker". The answer is "neither", but we also act as both (what?) We have a simple value prop: our customers work with us because our team is familiar with every intricate detail of not only the general CPG/Food+Bev supply chain, but our customers' specific supply chains as well. We're fortunate to have very few, if any, "transactional" customers. There are several reasons for this, the top two of which are: price competitiveness and know-how. The price competitiveness of direct/contract rates and the know-how of a managed trans provider. Is that more work for less? Sure, I guess. I also firmly believe that with tightening of margins and democratization of tech and capacity, the managed trans model will soon fall to the wayside. My reasoning for this is as follows: Post-‘08 the term “fiduciary” became all the buzz on Wall St. “Fiduciary responsibility” meant that brokers/advisors/fin planners had a legal obligation to point do what’s best for their customers, regardless of the outcome for the broker. It’s what ushered in management fees compared to commission-for-trades of the past era; a more consultative approach to financial planning. Sound familiar? So what if we started to act as fiduciaries- educating, guiding, advising shippers on what’s actually important, while also providing the on the ground services? Buying power for better rates? How about spend consolidation that gives shippers a clear snapshot of their spend, where the bucket leaks, what SKUs are net winners, what channels are net losers, etc. Flashy TMS and integrations? How about invoice consolidation so accounting and finance teams don’t have to reconcile hundreds or even thousands of invoices from myriad brokers and carriers, and allow them to have a clearer picture on their financial statements. Capacity for every area of the market? How about guiding homogenous customers towards group purchasing in select markets to drive down costs in dense areas, freeing up capacity in other areas, improving service and cost for everyone. This is the way. Is cost important? Yes. Is tech important? Yes. Is capacity important? Yes. What’s MOST important is leveraging relationships with true value-add partners that, through a mix of aptitude and tech, can deliver insights/results above and beyond just "lowest cost".

Continuing the conversation on spend types from yesterday’s post, with more on Supplier Spend. (𝘕𝘰𝘵𝘦: 𝘐 𝘩𝘢𝘷𝘦 𝘩𝘦𝘢𝘳𝘥 𝘥𝘪𝘧𝘧𝘦𝘳𝘦𝘯𝘵 𝘷𝘪𝘦𝘸𝘴 𝘰𝘯 𝘸𝘩𝘢𝘵 𝘵𝘰 𝘪𝘯𝘤𝘭𝘶𝘥𝘦 𝘧𝘰𝘳 “𝘴𝘶𝘱𝘱𝘭𝘪𝘦𝘳 𝘴𝘱𝘦𝘯𝘥” 𝘳𝘦𝘱𝘰𝘳𝘵𝘪𝘯𝘨. 𝘏𝘦𝘳𝘦 𝘪𝘴 𝘮𝘺 𝘷𝘪𝘦𝘸.)   📌 Supplier Spend is typically the total net monies paid to suppliers in a given period (i.e. net supplier payments). This is using cash accounting, measuring the cash paid.   💡 Think of it the same way as totaling your monthly grocery bill, where you add up the total payments for whatever period you are measuring (e.g. all your Costco trips in May).   ❓ Is that method different from expense reporting or financial statements? Excellent question, and yes, it is different. ◾ Financial statements, and typically expense reporting as well, generally use accrual accounting. The expenses are shown based on when you take the benefit of the expense, not when you paid the supplier. ◾ Accrual accounting and cash accounting are both important, but they have different uses and requirements   That may seem confusing, so let’s expand our grocery example to add more clarity.   💡 For the groceries, let’s say you buy in bulk and plan to do major food prep, so you only have to shop every other month. When you go shopping, you spend $1200 for each trip, every other month. ◾ If this were spend reporting, you would see $1200 every other month (cash accounting) ◾ From an expense reporting view though, you are consuming food monthly, so each month would show $600 of food (accrual accounting)    As usual, there may be some exceptions, my accounting comparison was simplistic, but a good rule of thumb and the takeaway here is to:   📌 📌 Use actual payments to suppliers for any spend reporting 📌 📌     Have a view or any comments on the topic? Please let me know.   Ryan #procurement #SpendManagement #BusinessSpendManagement

This is a perfect example of how we can partner with companies to help support and accelerate their growth trajectory. #AccountingExcellence #ProfessionalGrowth #ClientSuccess

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Key Accounting Formulas Every Supply Chain Professional Should Know Understanding the financial side of supply chain operations is crucial for making informed business decisions. Here are six essential accounting formulas that play a pivotal role: 1- Inventory Turnover  Formula: Cost of Goods Sold (COGS) / Average Inventory  Use: Measures how efficiently inventory is managed and how quickly it's sold over a period. 2- Days Inventory Outstanding (DIO) Formula: Inventory / COGS x Number of Days  Use: Indicates the average number of days it takes for inventory to be sold, helping manage stock levels effectively. 3- Cost of Goods Sold (COGS) Formula: Direct Materials + Direct Labor + Overheads Use: Represents the direct costs associated with producing goods, a key factor in determining profitability. 4- Return on Assets (ROA) Formula: Net Profit / Total Assets  Use: Shows how efficiently a company is utilizing its assets to generate profit, crucial for asset-heavy industries like supply chain and logistics. 5- Asset Utilization Formula: Sales / Total Assets  Use: Reflects how well a company uses its assets to generate revenue, directly impacting operational efficiency. 6- Return on Investment (ROI) Formula: (Gain / Cost) x 100  Use: Evaluates the profitability of investments, helping in decision-making for expansion and new projects. These formulas provide actionable insights that drive efficiency and profitability across the supply chain. Stay informed, and keep optimizing! 🚚📊 #SupplyChain #Accounting #Logistics #Warehouse #Operations #FinancialManagement

Macy’s Adds a New Take on “Free” Delivery An accounting employee at Macy’s intentionally misrepresented delivery expenses, hiding between $132 million and $154 million over a three-year period (Q4 2021 to Q3 2024). Macy’s claims no impact on cash management or vendor payments. Aside from the obvious questions about the outside auditor or the internal financial controls at Macy’s, this incident is yet another example of how freight spend in most companies is opaque, filled with bad data, and often lacks oversight. If this can happen to Macy’s, consider the potential issues for a much smaller company with a smaller accounting and freight staff. Reach out to Synchro today to learn how Synchro’s freight management services can strengthen your company against fraud and excess costs.   https://lnkd.in/esYvuiXr.

Cost Structure — Margin Analysis: COGS Margin & Gross Margin When it comes to margin analysis key elements to look them up from an annual report or an audited financial statement are the Cost of Goods Sold – COGS and Gross Profit and measure them against Net Revenue – Net Sales Revenue, top line figure of the Profit & Loss account – Income Statement to calculate COGS Margin and Gross Margin respectively. Another important point is to notice the difference between the COGS and the COGM – Cost of Goods Manufactured that is used to accounting for the costs incurred for manufacturing products and services – finished goods. To sum up, when analysing financial statements considering accounting policies, reporting frameworks – reporting standards, and industry benchmarks would definitely shed lights on the financial performance of companies across industries.

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