Botanic is modernising its treasury management tools
During the financial crisis of 2008, businesses in all sectors became increasingly aware of their dependence on short-term financial resources. Since then, cash has once again become king, and alongside very proactive policies for optimising the working capital requirements, strategies aimed at achieving maximum efficiency in cash management flows have become commonplace.
In some cases, the focus on these questions has led to changes in processes and even the tools used.
Botanic’s experience is a perfect illustration of this approach.
Botanic is a distribution brand specialising in gardening that was created in 1995, and operates in over 60 shops throughout France, in particular in the Rhône-Alpes region. It also has an online store to complement its sales on the ground.
The Group also runs around twenty Médor et Compagnie brand shops that specialise in the sale of pet supplies, particularly products for cats and dogs.
Dedicated legal structures are responsible for the wholesale trading of plant-based products, as well as a section of the logistics side of the business. These two subsidiaries work both in-house and with the Group’s external clients.
Moreover, several property management companies hold the land and property used for most of the shops operating under the Botanic brand.
A holding company deals with the capital-related functions of holding operational subsidiaries, and is responsible for providing support functions (including finance, HR, IT, purchasing and marketing).
Altogether, the group includes just under 130 companies and employs 2,200 staff in an average year.
Botanic’s financial organisation
The treasury office is attached to the finance department, alongside the accounting, management control and legal departments; it is located in the Haute-Savoie region on the holding company’s premises.
It is responsible for relationships with banks, currency hedging, short- and medium-term financing management, investments and transaction management for all the Group’s companies across 250 accounts with 20 different banks.
Operating in cash pooling, it consolidates treasury managementon a daily basis for all entities, carrying out the necessary balancing to optimise the Group’s position. It centralises transmission of payment orders to banks. It also formulates the annual budget for consolidated flows and implements its monthly monitoring.
The choice of the Exalog Allmybanks software
Until 2009, treasury management was only automated to a limited degree, especially with regard to balancing transactions, which were prepared on an Excel spreadsheet. Flow budget monitoring also required staff to manually input a lot of data.
Although it was very efficient, the software used at the time was very labour intensive, which made the Group’s organisation infinitely more complex.
Soon after taking office, the finance director at that time asked an external consultant to draft specifications listing the functions needed to form a management style that would be simpler yet also more complete, and to proceed with a tender among the main providers of solutions, including our previous software publisher.
Exalog’s Allmybanks solution was the clear choice for reasons of cost, ease of use, the good balance between the range of functions and simplicity, and finally also because it operates in SaaS mode (Software as a Service).
Aside from the strict conditions set in the specifications, the capacity of Exalog employees to be reactive and their ability to deal with Botanic’s particular issues were key factors in the choice.
Issues encountered by Botanic, and use of the software
Botanic’s specific issues stemmed both from business constraints and the Group’s legal structure.
Although the transactions considered as units did not present any specific problems, their large volume required high levels of automation and a consolidated reproduction capacity, in order to manage an overview from a vast mass of information. This issue was compounded by the large number of legal entities and banks involved, a complex structure that resulted from historical choices regarding the composition of the Group and the associated financing modes.
Cash pooling management was a logical consequence of this organisational structure, being the only solution that met the essential requirements of consistency, speed and security and that provided both a summary and a detailed view of positions.
Allmybanks’ resources enabled all the necessary information to be concentrated into the treasury department, the only department able to implement the desired optimisations on an “industrial” scale.
Against this backdrop, one key requirement the solution had to meet was an ability to automate the daily balancing process, from displaying balances to preparing the accounting for proposed transfers.
Allmybanks took care of this requirement perfectly, as the tools relating to “central accounts “, “minimum transfers” and “objective balance” enable the balancing levels to be set, and the “accounting interface ” module then enables the accounting of transfers to be carried out without the need for manual intervention.
For inverse flows, third-party settlement files issued both by the ERP and the payroll software produced by each of the Group’s entities could be integrated easily, and therefore feed into Allmybanks in preparation for their transfer to the banks.
With the aim of greater automation once again, as much information as possible is directly injected into the forecast module, either from accounting files for mature third-party debts, or from the “loans” module in Allmybanks for medium-term loans.
In the case of Botanic, only Allmybanks’ budget function requires improvement. Its incompleteness is currently mitigated by the intervention of an ad hoc notional company that manually receives monthly data.
Allmybanks has met the expectations of the Finance department, both in terms of functions and costs, but above all with regard to ease of use. The product provides the solution to the automation and process simplification that the Group required.
Exalog teams put the product in place with the required levels of professionalism, and also ensured the process of transitioning from Etebac 5 to EBICS TS and to the SEPA standards went smoothly.
Although the new functions such as “purchasing centre” payment management or debt management were not crucial requirements for Botanic, the recent introduction of these demonstrates the Exalog team’s desire to improve the product in line with the needs of its users.
This ability to adapt is a commendable indicator of longevity in an environment that evolves increasingly rapidly.
Stéphanie Bombart Director of Customer Relations
Botanic mentioned that Allmybanks’ budget function was incomplete, and this feature was indeed only in its very early phases when they began using the software. In the last few months this module has been continually developed to improve performance, both in its display modes and in its management of short- and medium-term forecasts in the calculation of divergence.