Graphite Connect Partners with RapidRatings to Offer Deeper Visibility into Third-Party Supplier Risk
Businesses can now mitigate supplier financial risk through a new early warning system that integrates RapidRatings’ financial health ratings into the Graphite Connect supplier management platform
JUN 29, 2022
Lehi, UT – Graphite Connect, the first supplier management network built on a cloud-based platform, today announced a partnership with RapidRatings, the leading provider of financial risk assessments. Seamless integration of RapidRatings’ financial health ratings into the Graphite platform offers companies forward-looking visibility into the financial risks of doing business with third-party organizations.
Manufacturing and supply chain teams have managed risk for as long as the modern factory has existed. But within the last two to three decades, the explosion of digital and a global supply chain has accelerated supplier risk. Being able to effectively manage these threats is crucial, particularly for any business that partners with hundreds or even thousands of different suppliers.
“At Graphite, we are committed to eliminating the friction that surrounds supplier onboarding and risk management. This partnership with RapidRatings offers a real-time, holistic view of third-party financial vulnerabilities for more rigorous due diligence. Objective insight into the financial viability of third-parties empowers businesses to make faster, more informed risk management decisions and meet regulatory requirements. The ability to integrate financial intelligence capabilities so that clients can view a potential supplier’s financial health ratings in the Graphite platform is a huge breakthrough,” said Conrad Smith, CEO of Graphite Connect.
Through a combination of advanced analytics and proprietary algorithms, RapidRatings produces two key measures of a company’s financial health:
- FHR®: A single number from 0-100 that indicates the probability of default within 12 months
- Core Health Score: A measurement that reflects operational efficiency and long-term sustainability
Graphite customers can now identify early warnings of future performance or potential disruption issues before they occur. The financial insights gained support strategic decision-making whether that means taking risk mitigation action or adjusting the business relationship.
"We are excited to partner with Graphite Connect to provide an innovative approach in helping our clients manage today's challenges and mitigate future risk."
James Gellert, Chairman and CEO of RapidRatings said. “Financial health is foundational to building a resilient supply chain, and now more than ever, these insights are critical in reducing the risk during onboarding and building meaningful business relationships.”
About Graphite Connect
Graphite Connect is the leading supplier management platform that helps global enterprises and small businesses streamline the entire procurement process from onboarding to risk management. A central network provides a single, secure location to manage data, tasks, and teams. Both suppliers and buyers gain immediate and secure access to all the information they need—in one place. Key supplier commercial data like TIN checking, OFAC, and W-9 forms is automatically validated within Graphite to drastically speed up onboarding and mitigate third-party risk.
About RapidRatings
RapidRatings® sets the standard for financial health transparency between business partners, transforming the way the world’s leading companies manage enterprise and financial risk. RapidRatings provides the most sophisticated analysis of the financial health of public and private companies in over 140 countries worldwide. The company’s predictive analytics provide insights into how suppliers, vendors, and other third-parties are likely to perform. For more information, visit rapidratings.com.
Understanding the Intersection of ESG and Financial Health Risk Before the Next Wave of the Supply Chain Crisis
Guest post by Brad Saegesser, Senior Solutions Specialist, RapidRatings
According to a recent Barron’s article, The Next Wave of Supply-Chain Crisis Is Building, authored by RapidRatings Chairman & CEO, James Gellert, “Wave two of the supply chain crisis will come from suppliers that are profoundly degraded by the challenges of the past twenty months, where operational, reputational, and financial risks are being introduced to their customers downstream. It will happen when companies cease being able to Band-Aid over problems with cheap and historically easy to access capital.”
How do companies know which risks to watch for and which suppliers to select?
The article points out that the magnifying glass will focus heavily on how companies and supply chain risk managers are preparing for the next set of risks, which are harder to identify. Disruptive risks tend to have a domino effect on the supply chain, and while risks in and of themselves can’t be eliminated, they can be managed. As this second wave approaches, future-proofing the supply chain is critical and companies must design their risk management infrastructures and practices to break out of their siloes and engage their suppliers in a coordinated way.
Understanding ESG-related risk has become a growing area of focus for supply chain professionals and their organizations. Working with ratings providers, such as EcoVadis, to gain valuable insight into performance on a range of ESG topics is key to understanding an organization’s overall sustainability and how it stacks up against its peers. Other less discussed, but equally important risk areas, include innovation, research and development, and cyber security. While all of these domains will shape the future of supply chains, the traditional factors of quality, delivery and, of course, financial health, still provide the framework from which companies must design their strategies. However, unlike the other risk areas, financial health is not adjacent or parallel to these areas – it is the foundation and a leading indicator of a company’s overall performance that helps identify early supplier distress signals.
In the wake of the COVID-19 pandemic and subsequent economic downturn, large enterprises have an even deeper interest in the financial well-being of their suppliers. Much like sustainability, financial health transparency is expected in today’s business relationships – especially from private companies. Companies are looking to financial health ratings, in addition to other factors such as ESG ratings, to select new suppliers and effectively support suppliers in need, but they can only do this if there is transparency between partners and scope for collaboration.
Fortunately, one of the biggest recent trends in supply chain risk has been
supplier collaboration.
Private company suppliers also recognize the commercial value in transparency and are more open to disclosing financials; intellectual property; information security; environmental, social, and governance initiatives; and other sensitive material. Supply chain risk professionals who engage with these suppliers to understand their financial health are best positioned to help mitigate problems and build the most resilient supply chains. During the global pandemic, many organizations accelerated payments to suppliers experiencing liquidity and cash flow issues. This collaboration – brought about through financial transparency – helped suppliers keep their operations running and avoid disruptions to their customers.
Transparency between business partners is critical.
Most businesses don’t want to stop working with their suppliers, especially those that are struggling, without making an effort to help them improve. RapidRatings’ predictive financial health data shows that our clients are looking for better ways to engage with suppliers that may have some risks, rather than simply parting ways with them. Transparency is the crucial link between suppliers and customers that can drive effective engagement. And as your customers’ senior management and boards of directors increasingly insist on supplier visibility, companies that proactively enhance transparency will stand to benefit.
That is why RapidRatings built
The FHR Exchange,
a community for both clients and suppliers that provides you with meaningful insights into your own financial health and enables you to communicate these insights to your key buyers and business partners. It is a modern, secure, and objective way of understanding your own potential in the value chain and how to leverage it for better business outcomes. Instead of waiting for one of your current or prospective customers to ask for your financial data, you can now proactively share a quantitative and unbiased assessment of your business performance with your own Financial Health Rating, called the “FHR”. Just as individuals have personal credit scores, your company can now have its own, more powerful, corporate strength and resiliency score.
By securely and discreetly submitting controlled financial information (profit and loss, balance sheet, and cash flow statements) via RapidRatings’ FHR Exchange, you will gain a clear understanding of your own financial health, compare how you’re performing against peers, and share key metrics with potential buyers.
RapidRatings works with global enterprise clients who depend on thousands of suppliers, just like you, and who understand that the world thrives when you thrive. As a member of the EcoVadis Network, we invite you to join the FHR Exchange. This proactive transparency will help you differentiate your brand, win new business, and prepare for the next wave of the supply chain crisis.
RapidRatings’ FHR Exchange is a secure membership platform for private companies to demonstrate financial health, forge more meaningful business relationships and, ultimately, thrive. The FHR is a score from 0-100 that indicates the overall financial health of public and private companies. It’s the global standard that private company suppliers rely on to demonstrate resiliency and attract potential buyers.
Learn how suppliers of all sizes are using The FHR Exchange to seize new opportunities, help their enterprise clients deliver on time, and create long-lasting partnerships. As an EcoVadis subscriber, signup for free by visiting:
The FHR Exchange™