Saving a restaurant chain $250,000 a year by improving banking costs associated with their SSC.
BRIEF
A restaurant chain with presence in several countries in Latin America with more than 30 restaurants in the region, implemented a Shared Service Center (SSC) where all the treasury back office activities were ran for all subsidiaries established in each country. The challenged the client had was to improve the banking costs associated for providing services to the SSC. The company had more than 1,000 accounts Wand +100 banking relationships in Latin America.
SOLUTION
A RFP was done and distributed to more than 10 banks with requirements on:
- Payment process standardization and automation for all the countries where the client had presence.
- Banking account structures. Type of structures available (i.e. Zero-balance account, etc.) to reduce de number of accounts the customer had.
- Banking account information. The RFP requested the type of account statement formats that the banks were able to send to the client on daily basis (i.e. MT940, SAP MT940, etc.)
- Availability of information (24/7)
- Electronic tolls to provide more visibility on account information and availability of funds.
Deadline was established to the banks to answer the RFP’s questions. Interviews were conducted with each of the banks to clarify questions on their answers. Based on that, a decision matrix was built based on the different features to be evaluated. Each of them had a weight of importance assigned in order to decide the best banking solutions for the client needs. Based on the matrix and management strategy established for the SSC, a decision was taken and two banks were awarded for different parts of the RFP.
Results & Recommendations
Due to the complexity of the project, the implementation of the banking solution has been completed at 60%. However, the client was able to accomplish the reduction of the bank accounts to 530. The automation of the account statement via file from the banks is implemented at 100% and the automation of payment processes with the bank has also been implemented. All the above activities have already saved costs for the client around $250,000 per year.