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AFP 2021 Blog

AFP 2021 Blog


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Cash in the Time of COVID

Aug 10, 2021

By Andrew Teachout, CTP; Susan Colross; Josh Mann; DeLise Cuadra, CTP; and Charles Sawicky

Effective treasury professionals regularly anticipate business changes and adjust their procedures, often with lead times permitting a thoughtful and measured approach. As we have seen during the coronavirus pandemic, treasury professionals are increasingly asked to pivot quickly during times of unprecedented change. In the AFP 2021 panel discussion, “Cash in the Time of COVID,” Josh Mann, chief strategist for DTS Connex, will moderate a panel of treasury experts including Andrew Teachout (Starbucks), DeLise Cuadra (Inspire Brands), Chuck Sawicky (Target) and Susan Colross (T-Mobile) to explore achieving the operational flexibility necessary to navigate today’s fast-paced and unpredictable environment.

The coronavirus pandemic not only changed our personal lives but it also changed the cash ecosystem, from coin shortages to cash in transit disruptions to massive store closures all with no notice. Fostering strong business partnerships, both internal and external, allow one to successfully harvest the data necessary to make informed and timely decisions for your organization. By using facts and not assumptions when pivoting away from tried-and-true processes, one can gain organizational support, speed consensus making, and avoid debates that would otherwise take up valuable time and resources.  Data transparency and accuracy are key factors to not only push through these uncertain times but also to prepare for future uncertainties without losing insight to the impact on employees and customers.

Navigating our organizations through the national coin shortage — one of the more impactful issues during the coronavirus pandemic crisis — required collecting data from both internal and external resources. First indications of an impending coin shortage came from our banking partners who began sounding the warning bell that certain denominations could be scarce. Just as the supply chain was disrupted for everyday household items, so was the supply chain for coin. Consumers ceased in-person cash transactions en masse and the recirculation of coin (which is reported to account for approximately 70% of coin availability) effectively stopped. The Fed could not replace the shortfall due to limitations on production capability exacerbated at that time by staffing and metal shortages, leaving retailers scrambling to serve their customers.

Having a thorough understanding of where the supply chain broke down was critical in determining whether revised instructions for handling coin were instituted temporarily or until further notice. As with many retailers, policy changes for our stores is a cross functional effort among one or more of the following: treasury, sales operations, asset protection, accounting (for store reconciliation efforts) and perhaps even legal. Having strong and established lines of communications with internal business partners meant the development of new procedures cleared internal approvals quickly. Some issues resulted in quick debate such as ways to handle cash paying customers without exact change. Others were more in-depth, such as whether to offer credit card only. Maintaining cash as an available tender type for some organizations became a regulatory discussion; for others, the discussion turned to an inclusion issue and a potential flash point during a time of heightened civil unrest. 

Join us to hear more about how we built our networks to gather information and collaborate with our colleagues, enabling us to adapt in a quickly changing environment.

Don’t miss this session, “Cash in the Time of COVID,” on November 8 at 2 p.m.ET  in room 152ABC, and check out all the sessions on the AFP 2021 SESSION EXPLORER. Register for the conference HERE.