With the B2B commerce industry rapidly changing, it should come as no surprise that some finance teams are struggling to keep up. However, new research by Hokodo, the provider of flexible payment terms for European merchants and marketplaces, reveals that as much as two-thirds of the industry is failing to keep pace.
In the new investigative report, produced in partnership with the B2B eCommerce Association, Hokodo reveals that 66 per cent of finance leaders say their team is unable to keep pace with the speed of e-commerce.
B2B e-commerce is going through a fast-paced evolution, with the market set to total around $2.641trillion in 2024. However, Hokodo’s report highlights that many finance functions aren’t future-proofed. In fact, its pan-industry survey of CFOs and finance leaders found that 17 per cent of finance leaders feel that their finance team isn’t prepared for the future.
The barriers to finance functions being future-proofed come down to a lack of balance between growth versus control. Forty-six per cent of those surveyed are struggling to strike a balance between financial controls – the policies used to manage financial resources and ensure the accuracy of reporting – and strategic growth initiatives.
Louis Carbonnier, co-founder and president of Hokodo
Louis Carbonnier, co-founder and president of Hokodo, explained: “Although the B2B commerce industry is digitising at a high speed, our investigation has found that finance teams are facing numerous barriers and simply can’t keep up with the pace of e-commerce.
“Future-proofing starts with tech enablement of the finance team. Whether it’s through reports like this or our digital trade credit offering, our mission is to ensure all finance leaders are ready to face the future of B2B commerce.”
When asked whether e-commerce has made managing financial controls more difficult, 39 per cent of finance leaders agreed; while only five per cent strongly disagreed.
Overcoming significant challenges
While not only trying to strike the right balance between growth and control, finance leaders are also facing obstacles around cash flow and payment terms. The survey revealed that the top three challenges for finance leaders are:
Working capital management and cash flow unpredictability (66 per cent)
Cutting costs (49 per cent)
Managing payments and payment terms (44 per cent)
Worryingly, these challenges are stopping finance leaders from being able to innovate and ensure that their finance function is future-proofed. The survey found that other key barriers to innovation are budget constraints (66 per cent), resistance to change (54 per cent), and lack of capacity (37 per cent).
Christopher Gee, UK lead at B2B Ecommerce Association, also added: “It’s reassuring to see this report offer a pragmatic approach to automating finance processes. This report provides timely insights and valuable strategies for anyone navigating the complex world of B2B finance, balancing efficiency with growth.”
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