Financing Goes Just-in-Time
The explosion of just-in-time manufacturing and just-in-time inventory is spurring another revolution in commerce: just-in-time financing.
As the rest of the business world implemented high-tech logistics and tighter supply chains, trade finance -- the boring, backroom backbone of global trade -- remained mostly unchanged. Even today, buyers and sellers predominantly settle their payments by a paper-heavy method called the letter of credit, first popularized by the Medici banking family of Florence more than four centuries ago.
The process, which requires the banks of the buyer and seller to coordinate with one another and exchange documents, often across oceans, can take as much as two weeks -- an eternity for cash-strapped companies operating on thin margins.
PAPER WEIGHT
In a world of just-in-time inventories, common systems for paying suppliers remain slow and complex.
? Cost of processing trade documentation is more than 5% of the total annual value of world trade.
? Cost of processing a simple transaction is about $400.
? Up to 24 forms must be completed for each transaction.
? Half of all letter-of-credit transactions are rejected by banks because of incorrect information from the buyer or seller.
Source: Gartner G2 report, June 2002
But recently, companies have begun investing in new Internet-based platforms that instantly link buyer and seller and sometimes relegate banks to the sidelines. Some of these companies sprouted in the late 1990s, when online procurement plans were first gaining attention. However, it is only in the past two years that these systems have gained significant traction in the marketplace.
TradeCard Inc., a company launched in 1994 and which now counts Warburg Pincus & Co. among its backers, allows a buyer to connect the flow of physical goods with the flow of electronic funds by handling both through the same electronic document. The company had 750 customers at the end of 2003, up from 567 a year earlier.
UPS Capital, a subsidiary of logistics titan United Parcel Service Inc., is pushing a similar product that allows it to transport both the hard goods of its clients and the money to pay for them.
Banks as well are trying to update and smooth their letter-of-credit processes by putting more of the functions online.
At stake is much more than a tech upgrade. The cost of processing trade documents is more than 5% of the total annual value of world trade, according to a report by business-research company Gartner G2. In addition, if companies can reduce the amount of time that their cash is held up in banks, they can boost their cash position and lower their financing costs. More importantly, if the financial supply chain can be made to work faster, the physical supply chain can move faster, too.
"The old letter-of-credit world is really going away," says Tom Lynch, managing director for State Street Bank & Trust in Hong Kong, who used to work in trade finance.
Bob Kaiser, chief financial officer of California-based hiking-shoe company Hi-Tec Sports USA, says his firm's transition from the letter-of-credit system to an electronic one created "a cash infusion in our company." Previously, every time Hi-Tec issued a purchase order to one of its suppliers in China, it had to open a letter of credit with its bank, a process that required presenting a stack of documents. The bank would then courier the letter of credit to the manufacturer's bank, a journey that could often take a week. The Chinese bank would then review the documents and inform the factory it could receive payment as soon as it shipped the order. The entire transaction could take as much as two weeks, during which time Hi-Tec's money had left its accounts but hadn't yet paid for the goods.
In the electronic system Hi-Tec now uses, run by TradeCard, the purchase order and the credit function are part of the same electronic document. That cuts down on the paper-processing time and allows people to track the two functions simultaneously. TradeCard replaces the buyer's and seller's bank with an insurance company that ensures that the transaction goes smoothly.
Mr. Kaiser of Hi-Tec calculates the lower financing costs mean that for each pair of shoes he orders, which cost him $16.50 (�13.50), he saves 20 cents. Because the information and funds are transferred more quickly, Hi-Tec says, it is getting its orders faster.
His suppliers seem to prefer it as well. William Chang, president of Wincap Industrial Ltd. in China, which makes shoes for Hi-Tec, says that in the past, waiting for payment after receiving an order would delay his purchase of materials needed to do the work.
In many ways, the changes taking place in trade finance are similar to those taking place in global trade itself. Response times are being shortened and middlemen are being stripped out of the process. The way big retailers operate with their suppliers has changed too, making the old trade-financing arrangements less efficient.
"Everyone has had to pull up their suspenders in the whole supply chain," says Ron Beattie, vice president of global sourcing at golf-apparel label Ashworth Inc. in Carlsbad, Calif., who also uses TradeCard.
UPS noticed this trend in 1998 and realized it could step into a role traditionally played by banks. "We're moving the goods, so we might as well move the funds," says Michael Bryant, president of UPS Capital's international division. Last year UPS handled $1.4 billion in payment transactions.
Banks have been eager to speed up the process as well. Bolero, a company created by the SWIFT banking cooperative and TT Club, an association of logistics and shipping companies, has put together several products that allow banks to handle many letter-of-credit functions online.
Development Bank of Singapore, for example, once issued its letters of credit on special security paper, like a bond. Now, more than 90% of its letters of credit are done electronically. However, the bank still requires shipping documents, such as bills of lading, to be submitted via paper, and it uses those to track a shipment and determine when it should authorize payment.
Banks say they have been able to hold on to their trade-finance business because of the broader relationship it builds with their customers. "We're in the business of lending," says Lum Yin Fong, managing director of global investment and transactions services at DBS. If a client opens a letter of credit, she says, the bank often is more disposed to extend a loan. "If we're lending a customer money to support his trading, we feel better about it because we know where the money is going," she says.
互联网助国际贸易实现适时融资
适时生产(just-in-time manufacturing)和适时库存的流行激起了商业领域的另一场革命：适时融资。
如今企业的物流活动科技含量提高，供应链也更为紧凑，但贸易融资这个全球贸易的核心依然没什么变化。即使在今天，买卖双方的主要结算方式仍是耗费纸张的信用证，这可是四个多世纪前由佛罗伦萨的美第奇银行家族首创的。
受理信用证需要买卖双方所在的银行相互协调，交换相关文件。由于它们通常相隔万里，文件传送往往需要两周时间，这对利润微薄又手头吃紧的公司来说实在太漫长了。
不过，有人近来开始投资基于互联网的新型平台，它能在瞬间把买卖双方相联，有时还把银行搁置一边。此类公司在上世纪90年代晚期冒出，当时网上采购刚开始崭露头角。但是，这类企业直到近两年才在市场上获得了迅猛发展。
例如，于1994年成立的TradeCard利用电子文件使买主做到收货、付款同步化。TradeCard的主要支持者有华平创业投资有限公司(Warburg Pincus LLC)。截至去年年底，TradeCard拥有750名客户，而一年前为567名。在今年第一季度，该公司处理的业务量较上年同期飙升了230%，虽然它没有透露具体数字。
物流业巨擘联合包裹运送服务公司(UPS)的子公司UPS Capital目前正在推广一种同类产品，能在替客户发货的同时代收货款。银行也试图通过把更多的业务放在互联网上来简化信用证受理程序。
这不仅仅是科技革命。商业研究机构Gartner G2的报告称，贸易单证的受理成本占全球年贸易额的5%以上。此外，如果企业能减少资金放在银行的时间，那么它们手头的流动资金就会增加，也能降低融资成本。更重要的是，如果资金供应链能运转得更快，那么货物供应链的运转也能随之加快。
道富银行及信托公司(State Street Bank and Trust Company)的董事总经理汤姆?林奇(Tom Lynch)曾做过贸易融资，他说传统的信用证的确要被淘汰了。林奇指出，这些信用证的最初目的是用来帮助陌生人之间做生意的，而现在做生意的方式已完全不同了。耐克公司(Nike Inc. (Cl B), NKE)就从来不与陌生人打交道。
Hi-Tec Sports USA是美国加利福尼亚州的旅游鞋生产商。该公司的首席财务长鲍勃?凯瑟(Bob Kaiser)说，当公司停止使用信用证而完全采用电子系统时，这就相当于为公司注入了现金。
以往，Hi-Tec每次向中国的供应商发出购货物订单时，都必须到银行开立信用证，开证需要一大堆的文件。银行再把信用证送到供应商所在的银行，这通常需要一周时间。中国当地银行再对这些文件进行审查，并通知供应商发货时就可收到货款。整个交易费时两周，期间Hi-Tec的资金已经从帐户中划出，但并未同时收到货物。
而对于Hi-Tec如今采用的TradeCard电子系统，购货订单和信用证功能都包含在同一个电子文件中。这既节省了受理书面文件的时间，又能让人同时掌握货物和货款的动态。TradeCard用一家保险公司取代了买卖双方的银行，以确保交易的顺利进行。保险公司向买家收取缴款费，预先承担了后者的信贷风险；而供应商一般只需支付交易费。由于这样做节省了纸张和人力，交易双方的费用都降低了。
根据凯瑟的计算，融资成本的降低意味著他定购一双鞋需花16.50美元，节省了20美分。Hi-Tec称，由于信息和资金周转的加快，公司的订货周期缩短了。
该公司的供应商似乎也喜欢电子交易系统。它在中国的鞋类供应商Wincap Industrial的总裁William Chang表示，由于采用TradeCard后货款交付期缩短了，他能够更好地安排业务。而在过去，如果信用证中途出现问题，由此引起的延误有时会让他十分被动。他早早地收到了订单，但却得等待货款或支付货款的承诺。有时他不得不为此推迟定购原料，这意味著发货时间也将延后。他指出，新系统很少出现延误，你口袋里的钱多了，因此对自己的业务也更有信心了。
从许多方面来看，贸易融资领域的变革与全球贸易领域发生的变革很相似。交易时间被缩短了，中间人也淡出了交易过程。大型零售商与供应商之间的交易方式也发生了变化，从而使传统的贸易融资方式显得效率低下。
加利福尼亚州高尔夫服饰生产商Ashworth也采用了TradeCard的电子交易系统。该公司负责全球采购的副总裁罗恩?贝蒂(Ron Beattie)说，在整个供应链中，每个人都必须加快进程。订货至交货的时间被尽可能地缩短，如果不能再缩短，就得发生变革。他指出，买主的订货量往往不多但很频繁，这就给贸易融资带来了更多的压力，要求后者更快捷、成本更低。
UPS早在1998年就注意到了这一趋势，并意识到自己能扮演银行的传统角色。UPS Capital的国际业务部总裁迈克尔?布莱恩特(Michael Bryant)说，UPS传递货物，因此也可以同时传递资金。
虽然财务风险评估与货物运送是截然不同的两项业务，但UPS从事的货物运输业务却使它在从事风险评估时具有了很大优势。作为承运人，UPS更容易评估风险，因为它知道货物的具体位置。如果预见到付款会出问题，它还能中止运输。去年，UPS Capital受理了14亿美元的付款交易。
发生变革的不仅仅是承运人，银行也同样急于加快贸易流程。银行业合作组织SWIFT和物流及运输企业协会TT Club就合办了一家名为Bolero的公司，它推出的产品能让银行的许多信用证受理程序都可在网上完成。
例如，星展银行(Development Bank of Singapore Ltd., BSG.YY)过去采用特殊证券纸开立信用证，如今该行90%以上的信用证都是电子化的。但是，该行仍要求提供提货单等书面运输文件，并据此追踪运输状况，并决定何时付款。
不过，由于银行有广泛的客户关系，它们至今仍能维持传统的贸易融资业务。星展银行负责全球投资和交易服务的董事总经理Lum Yin Fong说，银行从事的是信贷业务。他说，如果客户开立了信用证，银行通常会更愿意向其发放贷款。如果银行向客户提供贸易融资服务，那么银行往往对客户的印象会比较好，因为银行明了贷款的流向。
