Trade Finance Made Easy
Steinhoff Europe AG, one of the world’s leading household goods and general merchandise retailers, is a wholly owned subsidiary of Steinhoff International Holdings Ltd. (listed on the Johannesburg Stock Exchange). Steinhoff Europe runs furniture stores in Europe and the Pacific Rim countries and comprises the brands Poco, Conforama, Harveys, Bensons for Beds, Freedom, Lipo and ABRA. It reported revenue of EUR 6.7 billion in the financial year of 2014/15, making it the second largest furniture and household goods retailer in Europe.
Senior Vice President Treasury, Steinhoff
Steinhoff initiated the groupwide implementation of tm5 in 2008, enabling the treasury to keep pace with rapid growth and an increasingly complex corporate structure. The web-based TMS drastically reduced the workload and allowed the treasury to manage cash flows much more effectively. Their next focus was to make the risk posed by Steinhoff’s large volume of LCs manageable, to improve the use of corresponding lines and to reduce the overall complexity. The high number of interfaces caused by different systems, banks, formats and media represented an additional challenge.
The Solution: electronic LC management via SWIFT
BELLIN’s concept of minimizing workload and sources of error by means of an integrated system, at the same time creating groupwide visibility, convinced Steinhoff’s treasury and they aspired to an integrated solution. After consulting with BELLIN, Steinhoff decided to make use of the SWIFT connection for the two-way communication with national and international banking partners. BELLIN implemented the SWIFT connection and parallel to this Steinhoff introduced the tm5 component TTLC, recorded all LCs and evaluated if record and representation met the group’s requirements. BELLIN developed the necessary MT formats and incorporated the processes needed for the electronic opening of import LCs in tm5.
Steinhoff’s treasury team now has a very straightforward process of opening, managing, monitoring and changing LCs. Data is automatically imported and incorporated in the financial status immediately following the opening and advice of execution by the bank. This allows the treasury team to make the most of any lines and to achieve a complete overview of the many different due dates. Overall, this translates to a large degree of visibility and tremendous process cost optimization.
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