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Southwire’s cash application process is handled by a team of three analysts, a lead, a supervisor, and a manager. There are two banking partners and six lockbox accounts. Payments are received via checks and electronically with multiple remittance sources across checks, emails, EDI files, and web portals. Check payments are processed using bank lockbox files and a standard SAP lockbox program while EFT payments processing is completely manual using online bank reports. Buyer group payments account for 20% (by value) of all payments with a high volume of post-processing exceptions due to the involvement of multiple entities.
Manual processing of payments is time-consuming and has limited scalability to respond to growing business needs.
The Southwire A/R team used bank lockbox files and a standard SAP lockbox program to process check payments while e remittance aggregation across emails, EDI files, and customer portals was completely manual. Cash application for buyer groups was a major challenge since invoices were generated at the group member level while payments were routed through the parent group with separate remittances provided by each group member.
Moreover, identification and coding of short payments was done manually With growing volumes of deductions and limited data availability, it had started to show heavily on the cash application and deductions management processes
A leader in technology and innovation, Southwire Company is one of North America’s largest wire and cable producers. Southwire and its subsidiaries manufacture building wire and cable, metal-clad (MC) cable, FlatWire Ready products, cord products (including Tappan™ sound, security, and communication cables through Tappan Wire & Cable Inc.), utility cable products, industrial power cable, OEM wire products, SCR copper and aluminum rod, and continuous casting technology. Southwire also supplies MAXIS wire and cable installation tools to the commercial, industrial, and utility construction markets.
The solution enables customizations to handle specific business needs using artificial intelligence based algorithms Complex cash application scenarios, such as remittance with non-invoice reference numbers or truncated invoice numbers, payments made by alternate payers, cross ERP cash postings, payments made by parent company for multiple child business units, and buyer group payments, can be automated by custom configurations.
The cloud based SaaS solution integrates seamlessly with the system and works on a plug-and-play model
with minimal intervention with the existing process and near-zero dependence on internal IT team Users
can scale the services to fit their needs and enjoy a subscription-based service that’s kind to their cash flow since pay as-you-go models allow businesses to pay for only what they are using and not pay heavily for un-used licensing.
The cash application solution identifies and auto-creates deductions, captures deduction information such as claim number and reason codes, and maps customer reason codes to ERP specific reason codes It recovers the time and resources previously lost to manual identification and coding of short payments and helps in faster and more accurate resolution of deductions.