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Vendor
Payment Optimization (VPO)
Vendor Payment Optimization (VPO)
unlocks hidden profits in your cash flow. The process
increases cash by as much as 2% and discounts up to
0.15% of annual spend, producing an important impact
on the financial statement. Highly quantitative and
measurable, VPO first analyzes payment ranges and
average dollar-weighted payments, vendor by vendor.
Next coupled with a close analysis of vendor
relationships (inquiry characteristics, frequency and
timing), the process quantifies optimal payment timing
and reschedules payments in vendor master files to
lock in increased cash. A special module of VPO
trains purchasers with enhanced quantitative and
tactical skills to negotiate discounts in exchange for
days. This process increases buyer confidence and
leverage when negotiating with vendors. VPO also
improves cash flow based on check run invoice
selection procedures, establish policies for taking
discounts and handling vendor calls, and improves
efficiency of the accounts payable staff.
Most importantly, this
time-honored, turnkey process preserves good vendor
relationships.
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