Supply Chain Finance: Optimizing Working Capital in Logistics
Keywords:
Supply chain finance, working capital optimization, logistics, cash flow management, financial solutions, days sales outstanding, inventory turnover, supplier relationships, technological integrationAbstract
This paper explores the role of supply chain finance (SCF) in optimizing working capital within the logistics sector, focusing on how financial solutions can enhance liquidity, reduce costs, and improve overall supply chain efficiency. As businesses face increasing pressure to manage cash flow effectively while maintaining competitive advantages, SCF has emerged as a vital tool to bridge the gap between suppliers and buyers. This study employs a mixed-methods approach, integrating quantitative analysis of working capital metrics and SCF utilization rates with qualitative insights from industry practitioners and financial experts. The findings reveal that implementing supply chain finance solutions can lead to significant improvements in working capital metrics, including a reduction in days sales outstanding (DSO) and enhanced inventory turnover rates. However, challenges such as the complexity of SCF programs, the need for strong supplier relationships, and the importance of technological integration must be addressed to fully realize the benefits. The paper concludes with recommendations for logistics companies to leverage supply chain finance effectively, ensuring sustainable growth and improved financial performance in an increasingly competitive environment.
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