HSBC’s cash management team, led by Senior Cash Management Consultant, Courtney Schofield, worked closely with Matthew and his colleagues to understand the issues they were keen to resolve, what they wanted to achieve and the effect of the underlying structure of the business.
“The solution HSBC proposed responded to our needs and the unique circumstances we operate in,” says Matthew. “It offered us the potential to consolidate our cash positions across the business, allowing us to maximise returns on our available funds, but it also would ensure the local teams retained cash control.”
The degree of understanding of both the drivers of the business as well as the internal landscape developed by HSBC was such that Marlowe used the collateral the Bank provided to sell the new solution to internal stakeholders.
“Getting buy-in from the different businesses within the Group was vital to the success of the solution,” says Courtney. “Using a UK Domestic Cash Concentration structure meant that Marlowe would have visibility and control of its cash at a group level. Combining that with reverse sweeping provided comfort to the individual businesses that their autonomy was being respected and that they would still have access to their own cash balances the following day.”
In order to ensure buy-in and test the new structure against the business’ needs, the implementation was planned across four phases, allowing the process to be tweaked and adapted to deliver a solution that worked on both a group and individual business level.
“Phase one began in May 2019 and involved 20 separate accounts forming a domestic end of day zero balancing and next day reverse sweeping cash concentration structure,” explains Courtney. “Over the following weeks we refined and tested that solution to ensure it achieved the client’s priorities, and finalised the structure in March 2020.”
Matthew was impressed with how smoothly the implementation went, with any issues resolved quickly and the implementation team keeping Marlowe well-informed at all times. “The structure is already providing a number of benefits,” says Matthew. “Our ability to mobilise cash more effectively has reduced our dependency on our debt facility and enabled us to pay down debt more quickly. We’re also operating far more efficiently. The automation of processes has allowed us to free up staff time to focus on new opportunities.”
Marlowe has found that the cost of the new structure pays for itself, both in terms of interest savings and cash optimisation across the business.
“The solution that HSBC came up with meets our cash management requirements and has helped to make our processes leaner and more effective,” says Matthew. “It has successfully navigated the various concerns about loss of control from the different businesses within the Group and has provided management with the overall control and visibility we need to help support our strategic plans for the future.”