A new report from PricewaterhouseCoopers (PwC) urges manufacturers to protect, prepare and plan against financial instability in the supply chain.
In its report ‘Achieving Excellence in Production and Supply’ the global accountancy firm states: “We believe current financial and macro-economic conditions in 2011 are such that manufacturers should elevate their scrutiny of this risk factor. The banking crisis has made the recent economic downturn and the subsequent recovery different from previous economic cycles. Lenders and banks are under great scrutiny and have held on to very large portfolios of marginal businesses that they would have normally tried to take earlier action on. If interest rates rise, it is going to be more difficult for these businesses to service loans and the banks will have to pay more attention to them. Alternatively, any renewed downturn will put pressures on marginal companies and also on banks.”
Robust supplier assessment is the starting point for minimising financial risk, according to Altius Vendor Assessment. Through its partnership with Bureau van Dijk Electronic Publishing, Altius undertakes continuous detailed financial appraisal of all contractors to ensure that they are financially sound. Updates are made to the contractor’s profile as soon as there is any deviation in financial scores and Altius clients can set-up email alerts for specific contractors to give them instant notification of any changes. This is part of a series of continuous compliance checks to reduce risk and liability for client companies.