Calculum Delivers Cashflow By Bringing Supply Chain Into The Digital Age

In our latest Leaders InFocus conversation, we dive into the world of supply chain analytics and procurement with Oliver Belin, the visionary behind Calculum. Oliver unpacks how his innovative approach is transforming the way organisations optimise payment terms and unlock working capital. From harnessing vast data sets to drive AI-driven insights and ESG and DEI considerations into procurement strategies, this interview reveals how Calculum is not only redefining traditional practices but also setting new benchmarks for efficiency and competitive advantage. Join us as Oliver shares his journey, outlines practical strategies for enhancing financial performance, and offers a glimpse into the future of supply chain innovation.

Brett  

Congratulations on Calculum’s double win. How do these awards reflect your innovative approach to supply chain analytics and procurement excellence?

Oliver  

Thank you. First, these awards are a great recognition. Since we started testing the first algorithms and data, it has always been about innovation, launching a new product, a new solution, into the market. These awards reflect this, something that has never been done before: helping organisations optimise their payment terms with their suppliers based on data insights. 

Until now, Procurement did not have any visibility on payment terms- there were no references when it came to applying the right payment terms and negotiating these with suppliers. Our solution allows companies to have data insights, which help them be more competitive and unlock working capital, which is, as we all know, key today in the current high-interest rate market.

Brett 

The Calculum ADA platform has analysed over $3.1 trillion worth of global spend. How does this vast data set contribute to the accuracy and effectiveness of your AI driven analytics?

Oliver

Everyone talks about AI. However, AI is driven by data. When we examine the companies utilising AI, they typically access the same datasets. Essentially, data—including that used by Gemini and ChatGPT—comes from publicly available sources on the internet. In our case, companies share anonymised data with us that resides within every company's ERP systems, such as SAP and Oracle. This situation means everyone possesses a comprehensive data set, yet no one knows what payment terms other parties are offering to their trading partners. Our platform algorithms are fed by this data, which is expanding by about 100,000 new suppliers each month. Consequently, our algorithms and AI engine become increasingly accurate, enabling us to gain more insights regarding payment term negotiations and is able to identify trends.

Brett

Your platform promises an average of 8-11% improvement in working capital. Can you share a specific success story that showcases this impact on a client’s financial performance?

Oliver

Absolutely. Firstly what’s interesting is that we have companies across various sectors; we're quite strong in pharmaceuticals, but also in retail, food and beverage, oil and gas, and automotive—so different industries, usually quite large organisations. However, what stands out across these sectors is that we consistently observe a cash flow improvement of about eight to eleven per cent for every dollar analysed in spend. For instance, if you upload a hundred million dollars of spend volume, our platform identifies approximately ten million dollars in free cash flow simply by aligning your payment terms with market standards. 

To provide an example, we signed last year a Swiss organisation, which is in the technology sector, and in just a few months, the platform identified a few million dollars of free cash flow. This is not just by increasing payment terms across the supplier base, but it's by having a different, differentiated approach, where you align your terms to what the suppliers are offering to other customers, and also looking at the view on the supplier. So which suppliers are weak or strong, which can afford these longer payment terms on their side, which suppliers require access to funding options such as Supply Chain Finance or Virtual Card? This very differentiated approach allows further opportunities to unlock working capital without negative effect on the supply chain.

Brett  

Your solution incorporates ESG and DEI factors into the analysis of the supply chain. How are these considerations transforming the landscape of procurement and supply relationships?

Oliver

First of all, we are not providing ESG or Diversity, Equity, and Inclusion data; we collaborate with other data providers for this. However, the interesting aspect is to combine payment terms with DEI and ESG data. To observe changes in market behaviour and supply chains, an effective approach is not solely through sanctions and regulations but by offering benefits to encourage changes. For instance, if our clients see a better rating or assessment in terms of ESG or DEI on their suppliers, they can offer better terms with financing to the supplier, thereby improving the cash flow on the supplier side. Additionally, as you may know, there are regulations concerning payment terms, specifically focusing on SMEs (small and medium-sized enterprises), which necessitate treating these smaller organisations differently than larger suppliers – data which is all included on our ADA Platform.

Brett  

You have achieved a supplier matching rate exceeding 90%. How do these high rates enhance the overall effectiveness of your analytics and recommendations?

Oliver  

Many people often believe our analytics and data insights on payment terms are the key innovations or benefits. However, I can tell you that the most significant challenge we solved effectively is the classic problem of receiving poor-quality or unstructured, outdated data, and matching it an existing cleaned dataset. When dealing with approximately 100,000 new companies that are uploaded to the platform every month, there are several issues to navigate. Firstly, there's the volume, speed, and accuracy of the data upload. Currently, the status quo, as observed from advisory and consultancy firms or our clients, relies on Excel and stale data. Therefore, what we do exceptionally well is data ingestion and data matching. When a file containing supplier spend data—essentially the name, address, spend volume, and current payment terms—is uploaded, our system identifies and matches the data with our existing records. This process also involves cleaning and updating names and addresses when changes occur. Only once this is done can we compare like-for-like accurately. The system searches the database for similar or identical organisations and enriches supplier profiles with comprehensive financial data, payment terms, and so forth. The matching rate is crucial as it serves as the starting point for every analysis. On average, we achieve at least a 90% matching rate across all industries and countries worldwide. Additionally, we provide our clients with a confidence score, indicating how certain the platform is that it has identified the correct supplier.

Brett  

You provide third-party Supply Chain Finance options. How do you ascertain the optimal mix for each client and supplier programme?

Oliver  

We are not offering Supply Chain Finance. We collaborate with leading financial institutions and FinTech’s, as well as platform providers that offer Supply Chain Financing, Dynamic Discounting, and Virtual Cards, which are essentially credit cards for corporate spending. The advantage lies in our ability to analyse not just the top-tier suppliers but the entire spend. Often, we receive spend files containing between 50,000 and 100,000 suppliers from a given company worldwide, ranging from the smallest indirect spend suppliers to the largest strategic ones. By having a comprehensive view of the spending portfolio and suppliers, the platform can propose various solutions. For example, for the tail spend or smaller volume expenditures, a Virtual Card solution may be appropriate, while for strategic suppliers, a Supply Chain Finance solution could allow the buyer to adjust payment terms while simultaneously providing early financing or early payment discounts to these larger suppliers. Furthermore, with the option to utilize clients’ own balance sheet and liquidity to pay suppliers earlier, buyers can take advantage of early payment cash discounts. All these diverse solutions can be simulated, and the platform will specifically adjust or assign these suppliers to the suitable solution.

Brett  

So you're effectively determining the best solution for settling with suppliers by offering the best bespoke third-party offering?

Oliver  

These financing solutions always begin with assessing the opportunity, correct? Where are you currently standing, and what are your objectives? The second step is, which suppliers will accept the new payment terms and to which vendors can we offer financing? To ensure the right suppliers are considered, utilising and benefiting from financing, it's essential to identify them. In addition to calculating and suggesting the right payment terms, our platform also calculates the cost of debt and the weighted average cost of capital (WACC) for each supplier. This enables our clients  to compare the costs for suppliers to finance their own cash flow against what the client is offering, whether through its own funds as a buyer or via a third-party financier like a bank. 

Brett  

Looking ahead, what emerging trends in supply chain, analytics and procurement do you see shaping your future and innovations?

Oliver  

In terms of next steps in the development of our platform, we look at three key innovations responding to our clients demand. 

Our platform is currently focusing on the payable side, essentially assisting buying organisations in enhancing their payment terms with suppliers and amplifying their intelligence regarding suppliers. Naturally, every company is a supplier as well as a buyer in the supply chain. We have accumulated over $3 trillion in spend data, and we are now looking to flip the model by offering the same insights on the receivable side. The ultimate aim is to ensure both parties in a negotiation—the supplier and the buyer—have access to the same data. This enables full transparency concerning what the payment terms should be, the associated risks, and the cost of financing of your counterparty, allowing for fruitful negotiations based on common data accessibility. 

The second the development we foresee is the shifts in supply chains; for instance, due to sanctions or new tariff changes, businesses may find themselves needing to change suppliers. There are opportunities for providers such as Calculum to assist organisations in selecting new suppliers or consolidating existing ones while assessing risks of supply chain disruptions and financing costs. Therefore, the next 24 months and beyond promise to be particularly active for procurement and sales teams as they adapt to these new changes. 

The third one is related to the tail spend. Today, when analysing 50,000 suppliers, usually procurement teams will only focus and negotiate with their top-tier suppliers, leaving the majority of suppliers – the tail spend untouched. The reason is that until now there was no solution to approach these large number of suppliers and negotiate payment terms in an efficient way. We recently launched our Tail Spend Negotiation solution, which solves this challenge, allowing procurement teams to outsource the negotiating to Calculum while still controlling and tracking the whole process. Negotiating is done by our platform via email based on pre-approved messaging that can be monitored and tracked for compliance and transparency purposes.

Brett 

What I see is a detailed node map of suppliers and buyers - a map going deep not only on one side, but on both.

Oliver  

You are absolutely right, and we already acquired data to develop this map and offering the insights to our clients in the near future. With the recent innovations in data and AI, we find ourselves at the beginning of what’s next. From all the data we have already acquired, we can see what is happening at the second tier of the supply chain. Mapping and understanding the second tier of your supply chain on the payables and receivables side is important. For instance, in the past, I observed cases where first-tier suppliers were performing well, but issues arose in the second and third tiers, creating a domino effect, resulting in disruption across the supply chain. If one company faces cash flow problems or disruptions, it cascades down to the second tier, then the first tier, and eventually to the actual buyer. Therefore, there’s significant interest in gaining transparency of a company’s entire supply chain. 

Brett

Oliver, Calculum has undoubtedly embarked on an exciting journey of innovation, tapping into the vital essence of business by freeing up liquidity. It's truly inspiring to see your insights unfold, and once again, congratulations on your well-deserved awards!

Brett Hurll, Executive Editor at Global Financial Market Review, draws on over 35 years of international experience across technology and finance sectors, providing readers with sharp analysis and unique perspectives on emerging trends, market shifts, and the complex interplay between global business and political dynamics. His extensive background and senior leadership role position him as a trusted voice on financial markets and economic developments. If you have an interesting editorial reach out to our team at editoral@gfmreview.com