Financial, Contract Administrators Form New Council
Recently the president of our company presented the financial staff with a particular problem related to international financing and creating the necessary working capital to complete a project. Our initial reaction was to simply say that it could not be done.
As we gave the problem some thought, it become evident that we did not have the necessary financing information or networking capabilities within our industry to properly approach this situation, and others like it. It was clear that equipment manufacturers serving the water supply and wastewater treatment industry do not have a resource to address not only financial, but also credit and contract administration issues.
International demand for water and wastewater products and services will continue to grow for many years to come. Why? Because more than a billion people lack access to safe drinking water, and 3 billion do not have adequate sanitation, resulting in more than 5 million people dying each year from waterborne diseases. The Earth?s population continues to grow, tripling to 6 billion people since 1900. Many of the world?s developing countries must respond to rapid economic and population growth.
U.S. companies are well positioned to meet this growing demand, if they have access to the financing resources required to win export contracts. Finance professionals within the industry will be called upon to secure conventional and alternative forms of project and working capital lines of credit to support the potential international growth.
Contract negotiations is an issue we deal with on a daily basis. What are the strengths and weaknesses of our counterparts? What is the psychology involved? What is standard within the industry? Have I given up too much? These are questions that we would like to have answered before the negotiations begin. We need to draw upon the experiences of others to enable us to maximize the results of our negotiations.
Credit problems are a fact of life for any business. Cash flow determines how business is operated and managed. It is vital that we have the resources to insure that cash flows as projected. There are many credit agencies available, but where can our industry members best be served? Where can liens be utilized to reduce the risks we all face?
A group of finance personnel from several WWEMA member companies met to discuss the possibility of establishing a separate Council within the Association which would provide a forum for financial professionals within our industry to meet. We all acknowledged that there is a need for financial personnel, contract administrators, and credit managers to network and share our experiences and resources. The mission statement for the WWEMA Financial and Contract Administration Council is simple:
?To provide a forum for financial personnel in the water and wastewater markets serving as a common resource for addressing, educating, and providing information dealing with financial issues specific to our industry. This Council is directed toward financial professionals who are interested in information sharing and networking of domestic and international credit, collections, contracts, and financial and risk management issues.?
On Nov. 16 and 17 in Indianapolis, this Council will present a program for both WWEMA members and interested non-members which will address many of the issues and concerns we face daily. Speakers from government agencies and private industry will be available for roundtable discussions and participant involvement will be encouraged. We envision this first meeting of the Council will be an important step toward helping each of us succeed in this changing global market. For further information, contact the Water and Wastewater Equipment Manufacturers Association at 703-444-1777.
About the Author
Brien Johnson is controller for Lemna International Inc., St. Paul, MN, which manufactures wastewater treatment technologies for municipal and industrial applications.