World Trade - November 2008 - (Page 37)

ﬁnancing on longer terms than the local banks could offer. And, they needed the technology immediately. The combination of being able to provide the ﬁnancing to the hospital and UPS ability to ﬂy the machines down as soon as they were manufactured was compelling and resulted in a win for everyone involved.” Throughout the meeting one could sense an undercurrent of renewed determination and focus. “We went after big companies,” explains Vukas, “and that turned out to be the wrong market. In global companies you have multiple decision makers so you typically have a logistics manager, a CFO, a CEO, you may even have a procurement manager. What we try to tell them is that you need to look at your supply chain as if the entire thing is strategic; don’t look, for instance, just at procurement and say, ‘I want to get my procurement costs down.’ But they don’t get it. They’re running departments. What they don’t get is that by bringing down procurement costs they may be bringing up their inventory costs by holding it longer.” So the strategic sales focus for Global Supply Chain Finance has shifted now to smaller businesses. “We’re saying ‘why not get to those customers who really need us?’ They care about the cash conversion cycle, how do you move inventory to receivables to cash and how do you optimize how many days it takes for that to occur. We bring in the physical side along with the financing side, we show these customers how you can have visibility around your goods—so you won’t be told two days before you expect to receive your shipment that it hasn’t even gotten on the boat yet. Think about what that means for a small business, they were going to sell the product immediately and now they have to wait another 30 days before it physically arrives.” The small market, so they ﬁgure at UPS Capital, is the ideal market for Cargo Finance. “It’s the combined value proposition,” argues Vukas: the price of transportation may itself be higher with UPS but that factor shrinks in signiﬁcance with the savings realized in ﬁnancing as well as the beneﬁts of an integrated shipping solution. “Prospects will complain about price (‘you’re 20 to 30 percent more expensive than going to forwarders’) but our proposal and model is to take negotiating a commodity out of the picture. Financing gets them interested. But in many cases, we’ve got a huge ‘home run’ for them: think time in transit and freeing up cash. With their ﬁrst shipment they are impressed with the cut in time in transit; by the second shipment they’re excited about how suddenly they’re able to introduce new product because of the cash that is freed up.” WT For reprints of this article, please contact Cindy Williams at williamsc@bnpmedia.com or 610-436-4220 ext. 8516. Yes. DB Schenker: No matter where your company goes, we are already there. Rapidly changing markets call for increasingly ﬂexible solutions. Growth, competitiveness, and success are only possible if a company has a strong transportation and logistics partner at its side. We pave the way for customers to access markets – with innovative logistics solutions and transportation concepts tailored to the needs of speciﬁc sectors. Put us to the test at www.dbschenker.com/yes or call 800-225-5229. WTM11084Schenker2.indd 1 WWW.WORLDTRADEMAG.COM 10/14/08 2:19:47 PM 37 http://www.dbschenker.com/yes http://www.dbschenker.com/yes http://WWW.WORLDTRADEMAG.COM

Table of Contents Feed for the Digital Edition of World Trade - November 2008

World Trade - November 2008 Contents Unexpected Responses to Unanticipated Change Reading the States of Risk in Today’s Global Economy Supply Chain Watch Tradewinds Failed Promise: Mexico and NAFTA, 15 Years Later The Short Tale Marrying Trade Finance and Transportation into a Single Transaction Trucking Gets a Double Whammy Are We Safe Yet? Logistics Resurrects the Rust Belt Keep on Compressing

World Trade - November 2008

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