Economic turmoil in Europe – is the time right for dynamic discounting?
I caught up with Bertram Meyer, CEO of Taulia in Grand Central Station, New York yesterday. He was in a rush, on his way to JFK to catch a flight, so we only had 15 minutes but it was a fascinating 15 minutes.
I say Grand Central Station – Bertram was in Grand Central Station, I was in my office speaking to him over the phone but that doesn’t sound quite as exciting. I was speaking to him because I wanted to know more about Taulia’s new UK presence, what the rationale was behind opening an office in the UK and most interesting of all, the timing.
For those who aren’t aware, Taulia have a dynamic discounting solution for SAP users. It allows buyers and suppliers to negotiate discounts in return for early payment. Just this week, they opened up an office in the UK to complement their Silicon Valley and Düsseldorf locations.
So, why the UK? “Next to Germany,” Bertram explained, ”the UK is the second most important market outside of the United States. It’s accessible, partly because of the lack of language issues but importantly, there is a very well established market for factoring in the UK.”
It makes sense. Germany is an important market for Taulia because of the enormous proportion of German companies that use SAP but the UK hosts headquarters for many of the largest multinationals in the world, many of whom, likewise, use SAP
But what about the timing? Europe’s in economic turmoil at the moment. Offering any finance related solution in Europe right now is a brave step isn’t it? Quite the contrary claims Meyer: “Bank funding depends on the solvency of currencies as does bank to bank lending. When this is constrained, small businesses struggle to get funding.” This is where supply chain finance solutions fit in of course and according to Meyer, “Taulia’s solutions are more relevant in this climate than ever.”
Of course I agree with Bertram. I’ve argued many times that supply chain finance solutions like dynamic discounting are an important tool both to maximize treasury returns and to support cash strapped supply chain partners through challenging times.
Good luck to Taulia on your UK adventure.