Design of an efficient strategy for optimization of payment induced by a rational supply chain process: a prerequisite for maintaining a satisfactory level of working capital

The financial supply chain involves the flow of cash throughout the physical network. These financial flows are still performing as they did in the past thirty years. The management of the flow of money is complex since the delivery or receipt of a product or service does not necessarily give rise to an immediate collection or disbursement of money. This delay of synchronization impacts significantly the working capital and forces the companies to look for nearly the same visibility in their financial flows as in their physical ones. Different supply chain strategies can be used to improve the working capital. Companies can either manage their inventory more efficiently or reduce the Days Sales Outstanding (DSO) and payment terms from customers or Increase Days Payable Outstanding (DPO) by paying suppliers on later terms. We address in this the paper the problem of scheduling invoice payments in order to improve working capital performance.