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Increasing Mid-Market Visibility

Smaller companies, including National Financial Partners, Carlile Transportation and Columbia Sportswear, are turning to technology to drive efficiency and improve cash flow.

By Richard Gamble | Updated on February 01, 2010

The economic crisis has vaporized the vestiges of traditionalism that still pervaded a lot of middle-market companies and forced their executives to think about new ways of doing things. “This has been a great time to step back and take a fresh look at internal processes, efficiency and cash flow drivers,” notes Bernie Avondet, senior treasury management adviser at Cleveland-based KeyBank. “Cost is a big concern, and we certainly see cost-cutting, but cash flow is an even bigger concern, and we’re seeing middle-market companies spend money on treasury workstations or other high-tech tools that will help them improve cash flow.”

Middle-market companies are emulating large corporations by adopting more sophisticated services as they become increasingly affordable and easy to use, reports Laurie McCulley, a principal at Treasury Strategies in Chicago. “They’re seeing that they can leverage technology. They’re becoming involved in areas where they were never active before,” McCulley says. “We’ve seen companies under $1 billion in annual revenue set up global cash pooling structures. That’s new. They’re using SWIFT directly through the Alliance Lite model and finding it quick and inexpensive. They’re taking on global activity, either through sales or sourcing or both. They’re encountering foreign exchange issues. They’re worrying about their cash visibility globally.”

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