Research Of Supplier Finance In Fast-fashion Retail C Company

In the macroeconomic downturn,the rapid growth in previous years of fast fashion retail industry cannot be continued;even those well-known brands like UNIQLO,H&M,GAP,their revenue began to decline.Fast fashion target to those young,fashion customers,as we all know fashion trends changes every minute.In order to meet our customer’s requirement,our supply chain should respond quickly to provide new product.Nowadays,business competition cannot rely on individual enterprise only;it’s about all enterprises in the supply chain.Strengthening supply chain management and strengthening supplier relationship management is crucial to business success.Supply chain finance focus on the flow of funds in the supply chain,target to lower financing costs and improve business efficiency.Normally the enterprise with better economic status and higher credit in the supply chain will be called core enterprise,the core enterprise can provide financing guarantee to other enterprises when they borrowing money from other institution so that the cost of capital use can be reduced.In recent years,supply chain finance become a hot topic,banks and some enterprises began to research and practice how to adopt supply chain finance solutions.This paper based on fast fashion retail company C,after analyzed the as-is situation of C company’s supply chain and account payable management process,I get the result that it is the time to adopt supplier finance,also called reverse factoring,to ease the financing pressures of suppliers which caused by sales on credits.To adopt supply finance to a supply chain is not an easy job,it can be divided into 3 phase,solution design,realize and valuation & improvement.After this project,I get the conclusion that supply finance is a good instrument for both supplier and buyer to optimize financial flows;to introduce supply finance to a new organization,communication with both internal department and external suppliers and financial institutions are very important,and also IT support is a prerequisite,including internal ERP and E-banking systems.Supply finance involves several entities and the process is complicated.I hope this research can be a reference to those retail companies who are trying to adopt supply finance.In addition,it’s no doubt that the development of information technology will drive business transformation,the banks and enterprises should keep updated,seize the opportunity to change,be sensitive to those new commercial module such as internetwork,P2 P,cloud platform and big data driven supply chain finance.