Manage the Big Hidden Cost of Buying Equipment
Watch out for Soft Costs
Finding a lender with a strong specialty in equipment financing and who understands more than just the invoice amount is key. As long as soft costs stay within certain parameters of the total investment, you can fold them into your affordable monthly equipment payment, preserving your cash for more important needs.READ MORE
A see-saw of tax, regulatory and trade decisions has kept business leaders shifting back and forth from optimism to caution. The result is that cash balances remain high.
The Association for Financial Professionals (AFP) conducts a survey each year on current and emerging trends in organizations’ cash and short-term investment holdings, investment policies and strategies. Here are some key statistics from this year’s study.
The Tax Cuts and Jobs Act made the most significant changes to business tax law in more than three decades.
The Tax Cuts and Jobs Act made the most significant changes to business tax law in more than three decades. Find out how several aspects of the new code specifically impact capital equipment acquisition and finance transactions.
Covenants are additional terms in a loan agreement, typically used to set financial guidelines for a company.
Covenants are additional terms in a loan agreement, typically used to set financial guidelines for a company. Can you use your covenants to enhance the success of your business?
Taking the type of equipment, financial state of the business and other factors into account can deliver bottom-line benefits.
Are you spending enough time analyzing how to pay for that vital acquisition? Taking the type of equipment, financial state of the business and other factors into account can deliver bottom-line benefits.
AR and VR enable users to interactively use computer-generated information and data.
The introduction of artificial intelligence (AI), machine learning, robotics and other cognitive tools into the workplace ushers in a new age of industrial automation. It promises greater efficiencies, reduced costs, higher profit margins and other tangible benefits to companies investing in these technologies.
How can faster payments support your objectives of meeting payment deadlines, improving customer satisfaction, reducing costs, and streamlining your internal
Faster payments can help you meet deadlines, improve customer satisfaction, reduce costs, and streamline your internal processes. The first step is to understand emerging payment types and how they can answer your business needs.
It may be helpful to think of your treasury management provider as a specialist who collaborates with you to help optimize the value of your working capital.
There is no one-size-fits-all approach to treasury management. And while upfront costs and expenses for technology and professional support need to be considered, the return on that initial investment is likely to be positive, both short and long term.
Who wouldn’t want to optimize cash flow, improve purchasing convenience, control travel expenses, reduce back office tasks, minimize fraud and benefit from revenue sharing?
Who wouldn’t want to optimize cash flow, improve purchasing convenience, control travel and entertainment expenses, reduce back office tasks and time, minimize fraud, and benefit from revenue sharing or other rewards? If that sounds like you — consider the benefits of a purchasing card program.
The equipment financing decision goes beyond determining how to pay for an item. It is a decision that needs to be made in the context of a company's overall financial situation.
There are many factors to consider in deciding the best option for obtaining the equipment businesses need to move forward. Here are six of the top issues.
Discussion includes a look-back at the impact of these dynamics during the first two months of 2018 and expectations for longer-term effects.
Many U.S. companies continue to actively seek ways to increase energy efficiency.
Researchers have found companies with high environmental, social and governance ratings tend to outperform the market in the mid- and long-term ranges. As many boards and corporate executives are finding, sustainability initiatives can be very good for business.
While interest rates have been low for years, rising interest rates bode well for overall economic health — and may even hold good news for businesses.
Understanding and capitalizing on the opportunities that exist in rising rate environments can make businesses stronger. Focusing on the next best moves for your business, both in terms of borrowing and strategic investment, can help you stay ahead of the competition and make the best decisions for the future of your organization.
Even in the face of uncertainty, abundant capital and intense demand are expected to drive the M&A environment into 2018.
Whether you’re contemplating buying or selling a business — or if you’re just curious about current market conditions — this webinar will provide valuable, real-time market insights for key decision makers.
Accounts receivable remains the lifeblood of most companies. Here are some of the latest techniques and technologies for improving working capital performance.
New technologies allow companies to better integrate payment streams. This allows the business to benefit from controls visibility and technology not only with traditional paper receipts through a traditional lockbox but also electronic payments through a virtual lockbox or an electronic bill presentment and payment system.
Whether your goal is to diversify while staying actively involved in the business or to execute on a complete sale of the business, an ESOP can accomplish either.
ESOPs provide owners with the ability to attain liquidity and address transition objectives in a tax advantaged manner. ESOPs provide flexibility and intangible benefits that are difficult or impossible to achieve with alternative exit strategies.
Many studies corroborate the notion that employee ownership yields positive outcomes for the company and benefits that employees can readily recognize.
ESOPs provide owners with the ability to attain liquidity and address transition objectives in a tax advantaged manner. ESOPs provide flexibility and intangible benefits that are difficult or impossible to achieve with alternative exit strategies.
Evaluate investment options and anticipate future rate changes in order to set an optimal cash position and strategy.
Many financial decision-makers see today’s rising rates as either a brand-new phenomenon or an operating environment that they haven’t faced for more than a decade. Corporates will be required to analyze their short-term cash and cash position differently in order to prepare for the long haul.
The convergence of mobile technology and digital commerce is leading to real time payment innovation around the world.
You can't afford to wait for clarity when determining European strategies in the face of an uncertain Brexit environment. This seminar will arm your company with the tools it needs.
Improve your understanding of the economic impact and potential disruption to trade flows. Identify possible negotiation outcomes surrounding passporting rights and data privacy. Review foreign exchange concerns including currency volatility. Recognize the potential impacts on employees, customers and vendors.
Cash balances continue to remain high; there’s a large investment in bank products and organizations have no plans to invest in prime money market funds. Could that change?
While much of the talk around money funds asks why corporates left, AFP’s survey attempted to dig a little deeper. We asked practitioners what might entice them to come back. Would it be a stable NAV? Is it a certain number of basis points? Is it the uncertainty around it?
Real-time payments can help accelerate payments to speed up delivery, improve incoming cash flow or support cash on delivery payment terms.
Real-time payments represent a new phase in the evolution of digital payments. In the U.S., PNC Bank, along with other members of The Clearing House, is leading the way with the development of a Real Time Payments network -- the first new U.S. payment network in over 40 years. It’s a totally new payment type.
Changes to the NACHA Operating Rules, which govern the use of ACH, now enable ACH participants to speed delivery of more time-sensitive ACH transactions.
Same Day ACH has been especially beneficial when businesses experienced a delay in creating their direct deposit payroll files. Activating Same Day ACH allowed the files to be processed immediately and their employees were paid on time.
Are you facing international cash management challenges without uniform internal systems – and with thinly-spread local staff?
According to a 2016 Ovum survey of 200 treasurers in 23 countries, only 13% of multinational corporates can see their real-time global cash position. Treasury teams need to achieve a greater degree of centralization and regain control of their company’s most important asset: cash.
Trade negotiations, including changes to NAFTA and the uncertainties presented by Brexit make the need for foreign exchange risk mitigation more urgent than ever.
Evaluate current risk management practices, including the establishment of a hedge policy. Ensure that your internal policies and controls correctly account for risks. Update your management reporting systems to correctly list your FX exposures and hedging activity.
Companies must implement secure and efficient payment processes in the face of a complex and an evolving web of customs, laws and regulations that varies from country to country.
Best practices cover payment instructions, understanding local rules, tax implications, using local currency, and collaborating with your bank.
Even cross-border payments sent via SWIFT will land in a local payment system where unique banking practices may delay funds’ availability and result in fees to the beneficiary.
Companies need to implement secure and efficient payment practices in the face of customs, processes and regulations that vary from country to country. To avoid delays and extra costs, understand payment rules, regulations and networks.
Is your suppliers’ reluctance or refusal to accept electronic payments a barrier to increased usage? Here are some tips for driving increased commercial card acceptance.
Integrate supplier calls into your Accounts Payable (AP) department to introduce commercial card as a payment option that creates benefits for both parties. Incorporate commercial card payment information into standard communications (e.g., emails, check communications) with suppliers. Contact suppliers regularly to engage them directly on commercial card acceptance.
Between 2009 and 2015, commercial card volume almost doubled, as more companies switched from checks to electronic payments.
However, the rate of growth in commercial card volume has been slowing in recent years and fell to just 8% in 2015. This slowdown can be attributed to a number of factors, including organizational inertia, reluctance to overhaul legacy payment systems, or the belief that suppliers will not accept electronic payments.
PNC’s economists forecast that the Federal Reserve will continue to raise interest rates throughout 2017 and beyond.
In order to reduce the impact of rising rates on borrowing costs, companies should develop and implement a comprehensive plan to manage their interest rate exposure. PNC speakers provide a perspective on how external factors may affect your financing costs and what you can do to regain control.
One of the operational areas that offer considerable potential for technology-based transformation is the payments system.
Your financial institution should support you in recruiting suppliers to accept electronic payments, continually monitor the effectiveness of optimization efforts, identify issues with supplier recruitment, and activation of suppliers who have agreed to accept electronic payments.
Today’s rising interest rate environment may make it possible to improve your return on short-term cash.
Investment policies should include formalized forecasting and contingency plans to prepare key decision-makers for unexpected events. Contingency plans should include a scenario analysis that details events of varying risk or magnitude and how the company will react. For example — divest, stay the course or become more conservative.
Corporate financial managers must consider the impact of interest rate forecasts, future GDP estimates and potential tax reform on corporate cash strategies.
A number of short-term investment options have become part of the consideration set because of the rising market. They include variable net asset value prime money market funds, separately managed accounts and conservative ultra-short bond funds.
Three key areas of focus emanating from the new Administration and Congress are positive for the economy and growth: cutting taxes, infrastructure investment and less regulation.
As was revealed in the just-released 2017 AFP Risk Survey, one of the top three risk factors having the greatest impact on organizations’ earnings in the next three years was “U.S. political and regulatory uncertainty.”
Despite the prospect of a higher interest rate environment, access and availability in the debt capital markets remain open and attractive in both floating and fixed-rate segments.
Banks maintain a solid appetite for new loans as we enter 2017; however, it remains to be seen if banks begin to become more selective in their investment decisions in the overall context of a rising rate environment coupled (potentially) with a less rigid regulatory environment.
2016 included a number of significant political and economic events that will usher in changes during 2017.
PNC’s Harris Williams & Co. subsidiary (www.harriswilliams.com) is a leading M&A advisor with experience across a wide range of industries. Bill Watkins, Managing Director, and Larissa Rozycki, Vice President, discuss results from 2016 and the rationale behind predictions for 2017 M&A activity.
Cyber criminals are finding new and subtler ways to infiltrate legitimate businesses to conceal or advance their objectives.
As a financial institution that is focused on creating long-term, collaborative relationships with its customers, PNC believes strongly that the USA PATRIOT Act requirement to know our customers, their ownership, business purpose, suppliers and customers benefits our national security — and your security as well.
Technological advancements have led to shortened product development times, faster products to market, better distribution systems and streamlined purchasing.
While banks and FinTech providers can at one level be seen as competitors, there is increasing recognition by both sides of the strengths and limitations each possesses. This mutual recognition of their relative strengths and limitations is leading to increased collaboration between the two.
FinTech’s significance is underscored by the exponential growth in venture capital investing in the sector in recent years.
Going forward, FinTech is expected to impact a broad mix of financial service categories, including payments. Many financial service providers are preparing for this new reality by making strategic investments in and partnering with FinTech firms, as well as developing their own solutions.
Distributed ledger technologies record transactions in a decentralized network. The record of each transaction is shared across a network of computers.
While FinTech firms are helping to accelerate the pace of technological advancement within the industry, banks are investing in new technologies to provide better/faster/cheaper and more secure services to their client base.
Along with consistent growth, U.S. insurance firms are facing pressure on their bottom lines due to increased competition, low interest rates and regulatory changes.
By automating claims payments, insurance firms can reduce their reliance on checks and add disbursement options including ACH, prepaid cards and even same-day or real-time mobile solutions. Insurance firms can also improve receivables processing as well by accepting premium payments and contributions to annuities or other investment accounts in a variety of formats.
Long a trusted resource for financial institutions, SWIFT also supports corporate treasurers as they face expanding roles and shrinking resources.
SWIFT provides messaging standards that define a common means of structuring data for a broad range of financial purposes, from cash management and foreign exchange to trade finance. Additionally, SWIFT provides a highly secure proprietary communication platform and products such as SWIFT FileAct, which supports the exchange of bulk files between corporates and banks.
As e-commerce moves towards 10% share of total retail sales, mobile commerce is expected to grow exponentially in the coming years.
Widespread consumer adoption of payment technologies can lead to demand in the commercial space. For these reasons, trends in consumer payment innovation can be early indicators for changes in commercial payments.
The controls that come with the latest commercial payment methods enable CFOs, controllers and program administrators to exercise greater control over payment systems and practices.
The potential benefits associated with strong controls can be significant in terms of cost savings and peace of mind. Conversely, failure to implement appropriate payment controls can subject an organization to unnecessary financial risk.
You can find relief by improving management of invoice processing through payment.
Invoice automation can help you optimize the use of employee resources, significantly decrease the cost of processing invoices, help you capture vendor discounts more reliably and increase scale within your back office.
Chart provides detailed information on Money Market Fund regulation considerations at a glance.
Intended to preserve the benefits of money market funds while increasing transparency and strengthening investor confidence, new regulations effective in October 2016 will require a re-evaluation of your cash management strategy.
When outside capital is needed, good cash flow and working capital management will make it easier to find and less expensive no matter what the economic cycle.
Companies that make working capital efficiency part of their organization’s culture have the opportunity to generate more of their working capital internally, thereby lowering costs, improving their performance and boosting their competitive position.
If you are one of the growing number of companies doing business in China, recent moves to liberalize its currency can have substantial
bottom-line benefits for you.
Although U.S. companies have historically believed that negotiating international agreements in USD insulates them from exposure to currency volatility, it also puts them at a competitive disadvantage compared to companies that transact in local currency.
Changes to the NACHA Operating Rules will allow ACH participants to speed delivery of transactions that are more time sensitive than traditional ACH transactions.
Employers who want more flexibility in timing payroll, insurance carriers committed to fast payout of claims and reimbursements, individuals who need to get money to family members quickly, and billers wanting to offer a same day bill payment option are just a few of the groups looking forward to Same Day ACH.
Around the world, the momentum behind the move to real-time payments (RTP) — or “Immediate Payments,” as they’re often termed — is unstoppable and growing.
The U.S. has been conspicuous in its absence from the list of countries embracing RTP. That’s changing fast, with a surge of activity and initiatives under way to bring payments in the U.S. up to speed with the rest of the world. These moves involve a broad range of players, and an approach specifically geared to the unique needs and requirements of the U.S. market.
In our fast-moving world, payment systems must evolve to keep pace. Quicker payout, more flexibility, better control and improved cash flow are what customers expect today.
With encouragement from the Federal Reserve, the industry is responding to the demand for faster payments. Three leading organizations are already rolling out new payment options.
Many companies have found growth opportunities elusive and are focused on maintaining operational efficiency.
The increasing speed of doing business, the rise of globalization, the continued drive to identify and capture efficiencies, and the need to optimize relationships with suppliers and customers are driving companies to incorporate new technologies into their business processes.
Whether you have made the decision to sell your business or are just exploring your options for the future, understanding the road ahead can mean the difference between success and disappointment.
Business sales are complex transactions that are influenced by many variables. Planning ahead can increase the likelihood of success and potentially enable you to navigate tax considerations. An experienced investment banker who is familiar with your industry can ensure that your business is positioned to achieve maximum value and that the sale process is managed properly.
Many companies are interested in realizing the potential bottom-line benefits of payables automation but are unsure of how to introduce it. These 10 steps can help.
Among the steps companies can take toward payables automation are reaching out to their bank's treasury management officer, crafting a strategy, obtaining active buy-in from senior management, designating an executive sponsor and forming a payables auotmation project team with representation from various units.
In navigating through the sluggish growth environment of recent years, U.S. companies have increasingly focused on improving efficiency throughout their organizations.
Many companies have found significant opportunities for efficiency gains by introducing automation into their accounts payable opertaions. In addition to helping with efficiency, automation can offer a number of other benefits, including reduced costs and greater visibility into their pending financial obligations.
More and more companies are exploring the benefits of an asset-based solution. It works especially well in industries with tighter operating margins.
With liquidity at a premium, asset-based lending can be a particularly attractive alternative to a traditional bank loan or, to having to raise equity, which could dilute ownership. It can help middle-market companies move their business forward.
Companies are beginning to recognize the importance of having an investment policy that provides clear direction on how investments will be managed and how much risk is acceptable.
A solid investment policy include formalized forecasting and contingency plans to prepare key decision-makers for unexpected events. Contingency plans should include a scenario analysis that details events of varying risk or magnitude and how the company will react. For example — divest, stay the course, or become more conservative.
Companies are continually looking for ways to stay ahead of the competition. And yet many of them overlook the benefits of regular interaction with their banking team.
It's a good idea to meet with your banker and talk through upcoming expenditures, including capital expenses. Get to know your bank and the people on your banking team. Regular meetings can help your banker capture a more accurate picture of your business and respond more quickly when needs and opportunities arise.
Does your company have a well-thought-out investment policy? Does your policy have clear, measurable objectives? Has it been written down and shared with the appropriate team?
Putting your investment policy in writing is the foundation of effective investing. Your policy should provide benchmarks to help you evaluate how well it is working and what changes may be needed to make it more effective. While every company is different several elements should be part of every policy.
Webinar covers cash flow as a measure of performance, capital allocation as a determinant of value creation, how key metrics apply to private and public companies and other issues.
Cash flow metrics can help you better understand your own company or a company that you might want to invest in or acquire.Explore the importance of cash flow to a business and how using ROI measures is important to understanding companies.These metrics differ from using earnings for publicly-traded companies and can be used to value investment opportunities.
The ability to offer your customers and prospects financing for the purchases they make from you at competitive rates can help you meeting important business goals.
Using financing as a core sales strategy can help you sell more of your product to more people and keep your customers longer. You can close deals faster, include more product in the sale and get paid faster. Vendor finance programs also deliver significant benefits to your customers. They can get financing more quickly at favorable rates.
Equipment is just as important to the success of your company as intellectual capital and management strength. Are you leveraging its value to deliver maximum benefits?
Many companies have minimized or frozen spending and investments. However, the pressure to stay competitive in the global marketplace makes it unrealistic to hold off on technology and operations improvements for the long term. It's time to determine what initial investments make the most sense and how to finance them. We take a look at some creative approaches.
Securitization allows a company to monetize its trade receivables by legally isolating the assets from the bankruptcy estate of the company originating them.
As attractive revolvers mature over the next four years, there can be a liquidity gap that could hamper a company’s ability to finance working capital needs and pursue growth opportunities. Securitization can close that gap. It has enabled many companies to increase liquidity, lower financing costs and diversify their overall capital structure.
Industrial Revenue Bonds
Public sector financing can support private development projects that will fuel economic growth in communities. The lower interest rates and longer payment terms characteristic of programs such as tax-exempt Industrial Revenue Bonds (IRBs) can be used to finance growth.
Syndicating your bank credit facility can enhance your access to liquidity so that you can deal with day-to-day challenges and opportunities more effectively.
Syndicated loans can deliver capital in a timely manner and on more favorable market terms compared to conventional loans. By working with a group of banks rather than a single provider, you can also mitigate the risks that might arise from dealing with only one bank in an unpredictable environment.
Many companies are finding that an asset-based structure provides the liquidity necessary to quickly execute a buyout or facilitate a turnaround plan.
In the past, asset-based financing was viewed as the best option for companies with high risk profiles. Today, the rules about what type of company can benefit from this strategy are changing. And more and more are embracing the flexibility that asset-based financing can offer.
While banks today still consider traditional criteria like cash flow, leverage, equity and collateral, the experience and integrity of the management team is growing in importance.
Some managers who find themselves in challenging circumstances may be reluctant to talk with their bankers, fearing that relaying bad news might close off credit options. Successful companies are open and transparent with their banks, through good times and bad.
Credit is available with competitive terms for companies that see their bank as a vital resource. Here are tips for keeping an open relationship with your banker.
Imagine that you run a mid-size company with deep ties to an industry challenged by economic conditions. After decades of success, growth has stalled -- and your income statement is beginning to show it. Open communication with your banker puts everyone in a better position to structure and negotiate the right credit solutions for the challenges at hand.