1. The Supply Chain Finance Solution
EarlyPaytm
The Supply Chain Finance Solution

2. Agenda What is Supply Chain Finance (SCF)? How Does It Work?
What Is Important in an SCF Program?
Does SCF Deliverable a Measurable Return?
Why Use SCF? Why Not?!

3. What is Supply Chain Finance?
Less Expensive
Extra Capital
New or
Distressed
Business
Capital
Family & Friends
Angels
Venture Capital Funds
Factoring Invoices
P.O. Financing
Hedge Funds
Cash = Retained earnings
Suppliers Control Payment Timing
Receivables the bank cannot fund
Tooling (WIP & Piece Price)
VMI (scan or consumption)
Financing
Cost
Consistent
Business
Capital
Banks
Financial Institutions t

4. Validated and Posted in A/P Queue Customer Payment Issued
How Does Supply Chain Finance Work?
Day 1:
Ship and Invoice
Day 50:
Payment
Received
Supplier Activity
Ship to Pay Timeline
Buyer Activity
Day 5:
Validated and Posted in A/P Queue
Day 50:
Customer Payment Issued

5. InStream Receives Full Payment
How Does Supply Chain Finance Work?
Day 1:
Ship and Invoice
Day <=50:
Payment
Received
Day 50:
InStream Receives Full Payment
InStream EarlyPaytm Window
InStream pays supplier 100% of invoice amount less Accelerated Payment Discount assessed for 10 days
InStream pays supplier 100% of invoice amount less Accelerated Payment Discount assessed for 40 days
Ship to Pay Timeline
Day 5:
Validated and Posted in A/P Queue
Day 50:
Customer Payment Issued

6. *What is Important in an SCF Program?
Interacts Easily with Buyer, Supplier and Supplier Bank 69%
Minimal or No IT Work Required %
Provides Supplier Maximum Flexibility for Usage 29%
Can Address Supplier Needs Beyond Receivables 20%
*Source: Aberdeen Consulting Benchmark

7. Does SCF Provide a Measurable Value?
11 days shorter DSO*
2.9% lower average cost of short term capital*
More visible and flexible cash flow
Meet sub-supplier terms
Lower cost of goods sold
Suppliers Benefit
Buyers Benefit
13.6 days longer DPO*
Fewer supply problems tied to cash flow or capital issues
Maintain extended terms
Lower cost of goods sold
Fewer supplier calls
Supplier Banks Benefit
Flexible capital for clients when the bank cannot meet demands
Lower exposure without impacting clients
Help clients improve cash flow
Help clients improve profitability
Our research shows that Best in Class buyers enjoy 13.6 days greater DPOs – or days payables outstanding -- than their peers and obtain trade financing at an annualized rate 2.86 percentage points lower. Most important, Supply Chain Finance leaders are creating a lower cost and more financially stable end-to-end supply chain, resulting in a strategic advantage.
Best in Class suppliers also enjoy better metrics, such as 11 days shorter Days Sales Outstanding or DSOs. Because they have better cash flow visibility and predictability and improved access to credit and lower-cost financing, this helps to reduce the financial costs buried in their products. This cost savings can help drive better gross margins for both suppliers and their buyers.
*Source: Aberdeen Consulting Benchmark

8. Why Participate as a Buyer? Why Not?!
No Downside:
No Contract
Little or No IT Work
Very Little Resource Expenditure
Significant Upside: Improves DPO & Supply Chain
Maintain or Extend Payment Terms
Can Provide Significant Benefit to Strategic Suppliers

9. Why Participate as a Supplier? Why Not?!
No Downside:
No IT Work
Easy to Get Started
You & Your Bank Control Usage & No Unused Facility Fees
Significant Upside: Improves Financial Position
Lower Cost of Financing
Extra Capital When You Need It
More Predictable Cash Flow Management
Cash to Improve Credit Position with Key Suppliers
Lower Credit Exposure to Customers as Needed
Improve Balance Sheet Ratios

10. The End