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Cash flow forecasting


The Finnish cosmetics manufacturer has observed a growing global demand for all their products

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Year founded





The Finnish cosmetics manufacturer Lumene has witnessed a growing global demand for all their products which use arctic plants as raw materials.

In the expanding business, automated liquidity management and forecasting play an important role.


Having a wide product range which is constantly renewed created challenges for Lumene’s product life cycle management, working capital management and eventually for liquidity management.



By improving liquidity management and cash flow forecasting the amount of manual work could be reduced and data quality improved, which results in overall more efficient operations.


Lumene relies on automated Cash Flow Forecasting

Lumene has witnessed a growing global demand for all their cosmetics products which use arctic plants as raw materials. In the expanding business, automated liquidity management and cash flow forecasting play an important role.

As a small but bold challenger in one of the world’s most competitive industries, Lumene was the world's first cosmetics company to start using hand-picked wild berries in its products in 2001, kicking off a trend that many others have later followed. The company takes its inspiration and vision from the "Power of Arctic Nature", especially the effect of natural light: Due to the challenging annual cycle of long dark winters followed by months of 24-hour summer sun, Nordic plants have evolved to possess immense regenerative powers, which makes them valuable resources.

"We run an international business with a small number of employees. That's why it's important to have good cooperation partners and tools that make work easier. For us, automated liquidity management and forecasting have become a key part of our business."

Treasury Manager, Lumene Group

This concept has proven successful in international markets. Today the company's products are sold by 12 major retail chains in the USA in a total of 14,000 stores. Lumene can also be found in Sweden, Estonia, Ukraine and Chile, among other countries.

"The cosmetics industry is one of the world’s most competitive markets. Compared with the global giants, Lumene is a small but bold challenger." 

Treasury Manager at Lumene

The demand for a new and broader product range is constantly increasing. To meet the needs, the R&D department forecasts future trends and based on this develops new variants of existing product groups, for instance lipsticks in new trend colors. Alternatively, a completely new trend is created by launching an innovative product.

"We have a wide product range and over 1,000 different stock keeping units (SKUs). This volume poses a challenge for the product lifecycle management, for working capital management, and ultimately for liquidity management."

Data quality & risk management

Since 2007, Lumene uses Nomentias Liquidity solution to automate their cash flow management. The system collects cash flow data from the group's bank accounts and ERP system. Reports help monitoring the group’s cash position and its division between the subsidiaries.

"Our ERP system does not provide us with information in the format we need, so the liquidity management system has helped us a lot in this regard."

Another result of expanding to new markets and operating on an international scale, is the exposure to currency risks. At Lumene, these exposures are also hedged. The automated system is used to follow the group’s currency position and currency flows.

"Each market has their own peculiarities when it comes to payments and payment behaviour of customers. We have to understand all these factors and their effect on cash flow and cash flow forecasting."

A change of perspective

Cash flow forecasts are made almost daily at Lumene on a rolling 60-day basis. The cash flow report and longer-term liquidity forecasts are an essential part of the monthly reporting for the management and the board of directors.

"They are also important for our financial covenants. One of our result indicators linked with them, is the cash flow coverage ratio. In the current financial situation no company wants to have problems with covenants, since it might mean a new round of negotiations with the bank about the costs and availability of funding. Liquidity forecasting helps us to follow and forecast our cash flow carefully and to ensure that we reach our targets.

The perspective has changed. In the past, the emphasis was on monitoring the actual figures, but now we are more interested in the future and where the difference between forecast and actual figures comes from. I am looking forward to the new 4G version of Liquidity Management which features web access."

More information, better process

Lumene appreciates easy usability and reliability of the automated liquidity forecasting as well as the resulting time savings. The Liquidity solution, which provides more and better information than spreadsheets, has also changed their employees' way of working.

"It has increased my awareness of many things. Now I know the amount of overdue receivables at a given time or which of our customers always pay on time or use the cash discount. By being able to dig deeper into the different levels each transaction, automated liquidity forecasting has improved the entire liquidity management process."

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