Daily Cash Reporting
With little advance notice, a Midwest manufacturer was sold by its overseas parent to another entity. As a result, the manufacturer needed to quickly set-up its own banking arrangements and monitor its cash activity and balances each day. HTS was called in to aid the company in setting-up the required bank facilities and reporting systems.
HTS' Role: HTS assisted in the planning of and transition to the new bank accounts, and monitored the status of the project for management. For the daily cash reporting, HTS developed an Excel-based model that provided on a daily basis, the needed detail and summary information of all bank activity.
Client Benefits: The client was now able to quickly determine and accurately report their daily cash activity and balances for their numerous bank accounts. In addition, their new reporting allows them to reconcile to their bank balances both daily and monthly, automatically generate monthly journal entries, and provide an audit trail for those JEs. It also allows for the efficient monitoring of their debt, investment, and letter of credit activity and positions.
RFP for Credit and Debit Card Processing
HTS was brought in by this Midwest retailer to help them obtain lower pricing on their credit & debit card fees. The Company’s current contract was expiring soon, but they had no way of knowing what competitive pricing was available in the market, given their specific authorization and settlement methods.
HTS' Role: With HTS' experience and knowledge of the payment card industry, HTS developed a customized Request for Proposal ("RFP") for credit/debit card processing for the Company. This RFP documented the Company's specific methods of card authorization and settlement, the problems it faced (interchange downgrades, charge-backs, additional fees), its future direction and volumes, and other information. The RFP was then sent to several processors which HTS had identified as being able to provide the necessary services to the client. Proposals were analyzed — both on a quantitative and qualitative basis, and the top candidates were interviewed by the Company. The processor selected was projected to save the Company more than 20% over the current contract.
Client Benefits: Not only did the client save over $100,000 per year in card processing fees, but they now had additional pricing information on how they could generate further savings if their growth exceeded current projections, or if they chose to make certain system improvements.
A large retailer was disbursing payroll by direct deposit, and by paycheck/cash for many of its unbanked employees. It asked HTS to look into other safer and less costly methods for payment.
HTS' Role: Hoyt discussed several options with payroll vendors, chose the best types for the particular need, and analyzed proposals for an employee paycard – specifically one that would completely eliminate the need for producing any paychecks and avoid the handling of cash.
Client Benefits: By utilizing HTS, the company saved several hundred thousand dollars in check cashing and other expenses. In addition, the unbanked employees could now receive payment via paycard, which allowed them to buy goods electronically and obtain cash only as needed.
A grocery store chain with both high employee and customer accident claims asked HTS to help reduce its overall claims and associated costs.
HTS' Role: Hoyt developed internal reporting for the client, showing current vs. prior years claims by store, accident severity, claim costs and overall program costs. Hoyt then meet with the broker to discuss future strategies. Within weeks, Workers Comp and Customer improvement programs were instituted by the company, with claim frequency and costs reduced by 20% that year and another 20% the following year.
Client Benefits: By utilizing HTS for this project, in addition to fewer accidents, the company was able to quickly reduce claim payments and slow the increase in insurance premiums and standby letters of credits. Later, these too were reduced.
Merger Financing and Integration
HTS was engaged by this West Coast distributor to assist in a refinancing and in the planning and integration of the treasury operations for their acquisition of an East Coast competitor.
HTS' Role: HTS did all of the necessary work to assist the Company in obtaining the bank financing (and later, a private placement of debt) to support the combined entity's borrowing needs. In addition, HTS led the planning and execution for the consolidation of the combined treasury functions of the two companies
Client Benefits: The benefit to the client was in having the financial expertise on hand to successfully carry-out the integration activities for this significant transaction ($600 Million in combined sales). With this expertise available, the Company's CFO was able to focus on overseeing the high-level financial aspects of the transaction, and the Company saved money by not adding any employees to address what were only short-term project needs.