How Estée Lauder Transformed Treasury Operations with Serrala & SAP In-House Banking

Estée Lauder

Revenue: $15.2B
Employees: 52,000+
Products & Services: Cosmetic manufacturer
Headquarters: New York, NY, USA

KPI's:

• $650M+ in automated intercompany settlements per month
• 35+ banking relationships consolidated, reducing complexity
• 550+ accounts centralized for real-time cash visibility
• 163 cash pooling participants optimizing liquidity across 25 currencies
• Fully automated payments, netting, and FX hedge settlements
• Reduced external banking dependencies, cutting transaction fees

Background on Estée Lauder

A global beauty powerhouse, Estée Lauder operates across 150+ countries with a $14.3 billion revenue portfolio. With treasury hubs in the U.S. and Belgium, the company needed a unified, automated system to streamline cash management and intercompany settlements. Partnering with Serrala, they implemented SAP Treasury and In-House Banking, creating a fully integrated, automated treasury ecosystem.

• Founded in 1946, now a leader in prestige beauty
• 25+ brands, reaching 500M+ consumers globally
• Treasury operations across U.S. and Belgium, requiring global integration
• Needed automation to improve liquidity visibility & reduce inefficiencies

Business Need

Estée Lauder's legacy treasury system was fragmented, costly, and inefficient, creating unnecessary reliance on external banking services. Managing payments, liquidity, and intercompany settlements across 35+ banking partners led to high fees, slow processes, and a lack of real-time visibility.

• $650M in monthly settlements depended on costly external banking services
• 550+ accounts across multiple banks, making cash management difficult
• 35+ different banking relationships in EMEA, adding complexity
• Manual treasury processes, creating inefficiencies and security risks

Solutions & Implementation Story

1. In-House Banking (IHB) – The New Treasury Standard

To centralize treasury operations, Estée Lauder implemented SAP In-House Banking (IHB), consolidating intercompany payments and cash management into a unified structure.

• Three IHB centers (U.S. & Belgium) for global liquidity optimization
• Automated intercompany settlements, eliminating external banking fees
• Centralized treasury operations, improving cash visibility and control

2. Payments-on-Behalf-of (PoBo) & Straight-Through Processing (STP)

Estée Lauder eliminated redundant bank accounts and streamlined payment execution by implementing PoBo and automating STP for vendor and treasury payments.

• PoBo centralized payments, eliminating the need for subsidiary accounts
• STP automation reduced manual intervention, ensuring real-time processing
• Single SWIFT gateway replaced multiple bank connections, cutting costs

 3. Intercompany Netting & FX Hedge Settlement

The company transitioned from external bank-driven netting to an in-house model, reducing transaction fees and optimizing intercompany FX hedge processing.

• 200K+ invoices processed monthly via automated netting
• Integrated FX hedge settlements, eliminating manual reconciliation
• Cashless settlement via virtual accounts, improving efficiency

4. Global Cash Pooling & Liquidity Optimization

A fully automated cash pooling structure enabled real-time cash positioning across 25 currencies and 163 participants, reducing external borrowing costs.

• Zero-Balance & Target-Balance structures for efficient cash pooling
• Automated fund movements, eliminating manual tracking
• Internal lending reduced reliance on external borrowing, lowering costs

Results & Strategic Impact

Estée Lauder's treasury transformation with SAP In-House Banking and Serrala resulted in substantial cost savings, efficiency gains, and enhanced global financial control.

Key Treasury Results

• $650M+ in intercompany settlements automated monthly
• 163 participants in centralized cash pooling, optimizing liquidity
• 35+ bank relationships consolidated, simplifying treasury management
• Fully automated, real-time payments, eliminating manual processing
• Seamless FX hedge settlement & intercompany netting, reducing fees

Strategic Benefits of the Transformation

• Reduced manual treasury processes, improving efficiency and compliance
• Optimized intercompany settlements, saving millions in banking fees
• Enabled real-time cash visibility, enhancing financial oversight
• Lowered external borrowing needs, improving working capital management

With SAP In-House Banking and Serrala’s expertise, Estée Lauder set a new benchmark in treasury automation, ensuring a scalable, cost-effective, and future-ready treasury operation.

Check out the full story in this webinar with Estée Lauder's EVP of Treasury, Bart Taeymans.