CTRM / CM as an Architecture
A ComTechAdvisory Whitepaper
DEFINING COMMODITY MANAGEMENT
ComTech defines Commodity Management as the superset of software solutions that encompasses CTRM and ERP for Commodities where :
1 / ERP for Commodities naturally focuses on physical commodities and emphasizes production / procurement / origination , movement , storage , and handling of bulk and packaged commodities . This will usually include contract management , procurement , production , logistics , inventory management , assays / chemical analysis , pricing and fixation , hedging , settlements , and accounting . The primary users of this type of software are producers , industrial consumers , and processers .
2 / CTRM will have a trade-centric design with a focus on capturing and tracking both physical and financial trades , with configurable book and reporting structures , position calculation and valuation , PnL , and various aspects of risk , including market and credit risk . The primary users of CTRM software are traders and merchants .
That being said , there is considerable overlap between ERP and CTRM both in practice and in the marketing by various software vendors . In reality , many CTRM solutions will offer a good deal of ERP-type functionality , while ERP solutions are increasingly migrating into the trading and risk management arena .
/ Geographic differences including any unique business processes , language requirements , etc .
/ The type of company using the software ( industry segment coverage )
/ Local , regional and / or national regulations
A number of complexities must also be taken into account as the requirements for any Commodity Management solution will vary considerably based on factors , including :
/ The commodities to be managed , the quality characteristics of those commodities that must be accounted for , and the nature of their unique supply chain ( s )
/ The assets employed in the supply chain ( s )
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