SECTORS
Holding company

How can a holding company optimize its cash management?

Do you have one or more holding companies and find it difficult to manage the cash flow of several entities at once? That's normal. In this article, we'll look at the solutions available to you and how cash flow management software such as Fygr could be useful.
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Holding companies: key points to remember about cash management

Cash management is a major strategic challenge for a holding company, whose role is to manage several entities with diverse financial profiles. The difficulties arise from the high level of complexity involved in the circulation, projection, and arbitration of financial flows:
Complexity of inter-subsidiary flows requiring rigorous traceability
International issues (tax constraints, exchange rates, repatriation of cash flows)
Volatility of investments and holdings making overall cash flow unstable
Need for a consolidated view to effectively manage the group in real time
Fygr enables holding companies to regain control of their multi-entity cash flow by centralizing cash flows, forecasts, and financial performance across the entire group.

The specific cash flow challenges for a holding company

Why is cash management particularly difficult for a holding company? We have identified three major issues.
Complexity of inter-subsidiary financial flows
Volatility of investments and holdings
International financial risks

Complexity of inter-subsidiary financial flows

Holding companies manage extremely complex financial structures, with multiple legal entities and intertwined financial flows.

This multiplicity of shareholdings creates a highly intricate financial environment where every cash flow movement becomes a challenge in terms of coordination and traceability.

Fund transfers between subsidiaries, intra-group lending mechanisms, and tax optimization strategies generate administrative complexity that can quickly become unmanageable without the right management tools.

Volatility of investments and holdings

The economic model of a holding company is based on a dynamic strategy of continuous investment and divestment.

This approach involves constant volatility in financial assets, making cash management particularly unstable and unpredictable.

Changes in the value of investments, divestment opportunities, and acquisition strategies create a constantly changing financial environment, requiring an extremely fine-tuned ability to adapt and plan ahead.

International financial risks

Holding companies often operate internationally, which increases the financial risks associated with exchange rate fluctuations, different tax regulations, and varying economic contexts.

Each investment in a different country represents a new set of risks, with specific local constraints in terms of profit repatriation, taxation, and financial reporting.

This international dimension considerably complicates the clarity and predictability of the group's overall financial situation.
BEST PRACTICES

Best practices for cash management in a holding company

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Consolidate and centralize the group's financial vision

Managing a holding company involves maintaining a comprehensive and accurate overview of the financial performance of all subsidiaries. This practice consists of developing an integrated approach that allows the financial flows of each entity within the group to be monitored and analyzed in a consistent and synchronized manner. Financial consolidation requires the implementation of standardized reporting processes that enable the rapid and efficient collection of accounting and financial data from each subsidiary. This approach provides complete transparency on the group's overall financial health, facilitating strategic decision-making and enabling the rapid identification of performance levers or potential areas of risk.

Optimize the investment and resource reallocation strategy

Holding companies are distinguished by their ability to dynamically manage a portfolio of investments. Best practice involves developing a proactive approach to allocating and reallocating financial resources among the various entities within the group. This involves conducting regular, in-depth analyses of the performance of each investment, assessing its growth potential, profitability, and alignment with the group's overall strategy. The goal is to be able to quickly arbitrate between different investment opportunities, redeploying financial resources to the most promising activities and gradually reducing exposure to less profitable holdings.

Proactively manage inter-subsidiary financial risks

The complexity of a holding company lies in its ability to effectively manage the financial risks that may arise between the various entities within the group. This practice involves implementing precise control and monitoring mechanisms for intra-group financial flows, particularly with regard to intercompany loans, cash advances, and cross-financing mechanisms. It is crucial to develop a forward-looking view of potential currency, liquidity, or counterparty risks that could impact the group's overall performance. Proactive management also involves defining clear financial governance rules, with validation and control processes that ensure compliance and security of financial transactions between the various entities.
CHOOSE FYGR

Why use Fygr for a holding company?

The solution for managing the financial complexities of a holding company? Use Fygr. In addition to managing the traditional cash management challenges of a given company with maximum efficiency, Fygr allows you to manage multiple entities in one place thanks to its multi-entity view. Find out more below.
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GOOD REASON #1

Multi-account banking synchronization

Instantly consolidate the financial flows of all your holdings
Automatic aggregation of all subsidiary accounts in real time
Comprehensive traceability of intra-group transactions with breakdown by profit center
Instant consolidated dashboard of overall performance
GOOD REASON #2

Customized cash flow forecasts

Simulate the strategic impact of each investment decision
Simulation of the tax and financial consequences of the strategies under consideration
Forecast of cash inflows and outflows based on different assumptions
See the impact of different scenarios
GOOD REASON #3

Comparative analysis forecast/actual

Manage your group with surgical precision
Instant comparison of actual vs. forecast performance
Automatic detection of profitability differences between subsidiaries
Real-time tracking of the performance of each entry

They chose Fygr

Here's what some of our customers have to say after choosing Fygr to visualize their financial data:
A highly effective tool and perfect support! The FYGR team takes great care of its customers!
Julien BAZIN
Manager @ TSC Group
FYGR is a simple and intuitive solution for managing and controlling your cash flow. Bank integration is quick and bug-free—in short, I recommend it 100%.
Jean-Baptiste Mignot de Bresc
Founder and CEO @ Green Partners Real Estate
I use Fygr to get a clearer picture of my cash flow, and as a startup, it makes a real difference. The tool is simple and intuitive—I highly recommend it!
Thomas Sadoul
Co-founder @ Cocoon-Immo
FAQ

Everything you need to know about cash management for a holding company

Answers to the questions you ask us most often.
How to choose cash management software for a holding company?
To select the right cash management software for a holding company, it is crucial to identify your group's specific needs: number of subsidiaries, complexity of financial flows, international scope. Look for a solution that can consolidate multi-entity financial data and offers advanced simulation and projection features. Choose a tool that provides an instant global overview, with consolidated reporting and comparative analysis capabilities for shareholdings. Fygr may be a suitable solution for holding companies looking for a powerful and flexible tool.
What are the advantages of cash management software over Excel for a holding company?
Cash management software offers complete automation of the complex financial processes specific to holding companies. Unlike Excel, it enables automatic consolidation of inter-subsidiary flows, comprehensive traceability of intra-group transactions, and an instant overview of the group's financial performance. Backups are secure, bank data is automatically synchronized, and the tool facilitates multi-entity financial risk management.
How can reliable cash flow forecasts be made for a holding company?
To make accurate forecasts, collect detailed historical data from all group entities over several fiscal years. Analyze cash flow cycles, taking into account the complexity of intercompany flows, investment strategies, and cross-financing opportunities. Include all recurring group commitments, potential dividend flows, and investment or divestment scenarios. Use dynamic multi-entity simulations and update your projections regularly.
How long does it take to implement cash management software for a holding company?
Implementation varies significantly depending on the complexity of your group structure. The timeframe can range from a few weeks to several months, depending on the number of subsidiaries, the diversity of information systems, and the integration required. Fygr offers an adaptive approach that takes into account the complexity of your holding company.
How much does cash management software cost for a holding company?
Prices vary depending on the number of entities and bank accounts to be integrated. At Fygr, pricing is flexible, starting at €59 per entity and per connected bank account, with options tailored to complex holding structures. The investment must be evaluated in light of the potential gains in terms of financial optimization and risk reduction.
Who are Fygr's competitors, and which one should you choose for a holding company?
Fygr's main competitor is Agicap, but Fygr stands out for its flexibility and value for money. For holding companies, it is crucial to choose a tool capable of managing the complexity of intercompany financial flows, with advanced consolidation and reporting features.
How do I know if my holding company needs cash management software?
Your holding company needs such a tool if you are having difficulty quickly consolidating financial data, projecting multi-entity cash flows, or obtaining a comprehensive and dynamic view of the group's performance. This is particularly relevant if your group manages multiple investments, operates in different markets, or is experiencing significant growth.
What are the essential features for a holding company?
Key features include automatic financial consolidation, equity tracking, intra-group cash flow management, investment simulations, consolidated regulatory reporting, and comparative performance analysis. The ability to manage currency risks and optimize financial transactions for tax purposes is also essential.