The challenge

Complex account structure – General Mills has had a strong footprint in China for nearly 30 years with more than 400 outlets. The company has centralised its merchant acquisition and operational expenses payments to a single physical account for its entire China business. Due to the localised management requirement from the China taxation authority, each outlet still maintains local physical accounts (approximately 400) for tax payment purposes.

Fragmented payment and manual reconciliation processes – General Mills juggled between multiple internet banking portals to perform payments and access account information. Reconciliation was manual and the risk of human error was evident. Lack of consolidated visibility into its cash positions, fragmented payment processes and inefficient manual reconciliation led the company to seek automation and centralisation.

Dispersed idle cash – General Mills had surplus cash in the accounts of a few subsidiaries and a considerable amount of idle cash was not actively utilised. The company was looking for ways to optimise the value of funds while having immediate access to them when needed.

Regional HQ demand on system redundancy – General Mills Singapore, the Group APAC regional treasury centre (RTC) which oversees China, required a level of operational support should the Secure File Transfer Protocol (SFTP) channel be disrupted, or if the China finance team was unavailable. The Singapore team required a backup channel to operate and ensure business operation continuity.

The solution

Virtual accounts – General Mills turned to ICBC to streamline its tax payment account structures. ICBC Shanghai branch embarked on this month-long project and liaised with hundreds of local branches to optimise the account structure. The project has helped General Mills to eliminate 444 physical accounts and replace them with 444 virtual accounts under a single physical account maintained with the Shanghai branch.

SFTP pain.001 and mx.053 – General Mills sought a solution of direct connection between the bank via SFTP. Customisation was critical via the SFTP channel and the company worked closely with the Shanghai branch to resolve all details within three months. SFTP pain.001 and mx.053 was launched in March 2023. This enables General Mills to perform all payments from SAP seamlessly. An average of 1,000 transactions are conducted via SFTP every month.

China domestic cash pooling – the company worked with ICBC to set-up China domestic cash pooling to concentrate the balances of seven subsidiaries which are swept to the header account at end-of-day. General Mills can leverage the concentrated cash and invest in short-term investment options such as money market funds to maximise returns.

Centralised management via ICBC Singapore internet banking portal – General Mills Singapore worked with ICBC Singapore to open 25 accounts in China for nine different subsidiaries. This allows the regional HQ to have real-time access to cash positions and transactional activities in China and make payments on-behalf-of its China subsidiaries. The bank had to liaise with five different local branches and its HQ in Beijing. The implementation was achieved in just a month.

Best practice and innovation

The solution’s success hinges on its comprehensiveness, as it addresses multiple challenges faced by General Mills through collaboration with its trusted banking partner. It encompasses account structure simplification, system and process automation, financial optimisation and risk management.

This holistic and cutting-edge solution exemplifies the strategic foresight and showcases exceptional problem-solving.

Key benefits

• Cost savings.

• Headcount savings.

• Process efficiencies.

• Return on investment (ROI).

• Increased automation.

• Risk mitigated.

• Improved visibility.

• Errors reduced.

• Number of banking partners/bank accounts reduced.

• Manual intervention reduced.

• Increased system connectivity.

• Future-proof solution.

• Exceptional implementation (budget/time).