Automated Cash Flow Forecasting providing global near real-time visibility

Founded in 1957, SIG Plc is a leading supplier of specialist insulation, roofing materials, and sustainable building products and solutions. The group primarily operates via 440+ trading sites across UK, Ireland, and Mainland Europe to serve over 75,000 customers, primarily developers, contractors, specialist installers, and independent merchants.

The pandemic created unprecedented disruption for the construction industry with the knock-on effects continuing into 2022. As supply chains began to normalise, the outbreak of war in Ukraine in 2022 created volatile energy and raw material markets, which drove price inflation and macroeconomic uncertainty.

SIG Plc were looking to embark on a transformative journey with focus on digitalising operational processes to achieve the highest productivity – one of the seven key pillars of its return-to-growth strategy.

Traditionally cash flow forecasting at SIG Plc required multiple entries and validations to prevent errors and misreporting. The team relied heavily on multiple cash worksheets which captured data across entities, to ensure the group had sufficient liquidity to carry out their daily operations and support strategic initiatives.

The entire process was time consuming and ineffective, as teams were downloading bank statements to spreadsheets and reconciling cash flows across over 220 bank accounts on a daily basis. Collecting and consolidating data within multiple cash flow worksheets from numerous jurisdictions and sources was a major challenge for the finance team in terms of both time and accuracy. SIG Plc’s treasurer was keen to digitise their forecasting process with a solution that was user friendly, scalable, and easy to implement without creating any significant workload for the internal legal, IT team, and operating companies.

As SIG Plc’s global banker, HSBC was already providing the firm with traditional cash and liquidity management, cards, FX, and trade finance services. With this long-standing relationship, the team had trust in the bank’s ability to provide a contemporary Cash Flow Forecasting (CFF) solution to meet their needs.

“The HSBC CFF Tool has been a significant leap forward in terms of SIG’s journey to better involve technology from a short-term cash flow forecasting point of view and to move away from a reliance on spreadsheet-based reporting processes.

The technology offered by HSBC has expanded our group capabilities in terms of currency specific forecasting, analysis of cash movements and allowing for better performance measurement of our cash forecasting operations.”

Dan Hitchen, Group Treasury Manager, SIG Plc

SIG Plc went through a simplified onboarding process, which enabled activation of Cash Flow Forecasting within 72 hours of signing the legal documentation.

The users had access to HSBC’s Cash Flow Forecasting solution, pre-loaded with 12 months of historical banking data. HSBC’s Cash Flow Forecasting has an in-built data integrator for bank transaction and FX rates which allows automated reporting of SIG Plc bank accounts from day one of service activation. The Treasury team also leveraged the new built-in trend forecasting functionality to automate forecast generation using historical bank actuals.

An agile implementation methodology was utilised to deploy a customised forecasting solution in-line with SIG Plc’s requirements. Workshops and ongoing analysis of requirements ensured that final outcomes remained aligned with SIG Plc’s business needs. The solution was deployed within budget and implemented across over 10 business units in just 2 months, demonstrating efficiency and rapid scalability.

HSBC’s Cash Flow Forecasting solution resulted in the simplification, integration, and automation of disparate and localised cashflow forecasting processes into one globally connected cash management solution providing near real-time visibility to Senior Management. Using the advanced data-analytics within the platform, the team continually refines the forecasting model to enhance forecast accuracy.

With easy access to data and improved confidence on the forecast numbers, the Treasury team is now empowered to focus on cash flow analysis and take data-driven decisions that have a strategic impact for SIG Plc in this uncertain environment.

• Fully integrated Cash Flow Forecasting solution: Streamlining and automation of forecast process has saved SIG Plc an average of 6 days of manual effort monthly while also reducing manual errors and erroneous intercompany forecasts by automating repetitive tasks.
• Near real-time visibility for Senior Management: Allowed SIG Plc to get an accurate insight of future cash, effectively use cash surpluses in some parts of the Group to finance shortfalls in others, and minimize drawdown on RCF in this rising interest rate environment.
• Reduced IT and legal overheads: The forecasting solution is integrated within HSBC’s secure electronic banking system which has reduced IT resource and legal overheads for SIG Plc in managing additional treasury platform.