Is credit good in business?

[Hate2Wait]

If you just like to see for cash then you may not be able to acquire those big customers so its our choice

 

[Starmix]

In my case, my business is small so there's no credit to happen hehe. Milk tea drinkers come and go. But there are also repeat buyers and became my friends. I may refer RIF to them. Hehe.

 

[Hate2Wait]

Your business is of different thing but even you can ask your supplier for credit period so you don't need to pay in cash

 

[Starmix]

You guessed it right, but I did it once only to compensate my kind franchise operator but the interest is 15 percent, my gosh. Because of that high interest I no longer purchase on credit. There's no logic.

 

[relcap23]

I think it depends on the situation and circumstance. If you are selling food and you have a certain neighbor so hungry, it will be inhuman of us if disallow the hungry neighbor to buy in credit. But if it always happens and no single payment is made, that neighbor needs discipline by refusing to purchase food on credit. For a big store, unless that customer already built good friendly relations, a good creditor, no reason to refuse, so it is case to case. What about your observation in your community?

If the business capital is small credit is not advisable. The. business cannot generate working capital because of credit customer. I know a friend who has a small store her customer buys on credit and pays every end of the month so that's the only time she can raise working Capital and can replenish her stock which later on the friend gets on credit again. It looks the business revolves with one customer only.

 

[Starmix]

If the business capital is small credit is not advisable. The. business cannot generate working capital because of credit customer. I know a friend who has a small store her customer buys on credit and pays every end of the month so that's the only time she can raise working Capital and can replenish her stock which later on the friend gets on credit again. It looks the business revolves with one customer only.

It's not good to approve credit to someone a customer for it's too long to wait for the payment unless 10 days only, if after a month, the profit is stagnant from one creditor.

 

[relcap23]

It's not good to approve credit to someone a customer for it's too long to wait for the payment unless 10 days only, if after a month, the profit is stagnant from one creditor.

True... The small profit margin is eaten up by the time the credit is paid. Credit sales is good for big businesses.

 

[Starmix]

True... The small profit margin is eaten up by the time the credit is paid. Credit sales is good for big businesses.

That applies only to big companies and corporations. They won't go bankrupt, but for small businesses with insufficient and struggling capital not good to accept purchase in credit, they business surely collapses.

 

[Chibson]

Selling on credit to customers is not a good business idea at all.

if you're a business person it is not advisable because it can make your business to dwindle. That's why you need to avoid it.

 

[Elendu]

Businesses may need to borrow money to finance their operations while they wait for customers to pay their debts. This can result to an in increased borrowing costs and interest expenses.

 

[cherry123]

Credit isn't goit especially when it comes to selling the products to their family and friends because as they demand credit sales they don't pay which may affect the business

 

[Starmix]

Credit is good to those who built goodwill for the company or business, customers who are loyal and never failed to transact business with you. The trust factor is a must for someone to be approved for a credit application.

 

[Niyi Briggs]

Whether you like it or not, credit sales is part of business. The only cache is that it must be controlled. It should not be allowed to be overboard.

 

[Etini Willie]

I don't believe that businesses should be operating by giving credits to people. It delays the entire business flow when you need money to do something and your money is in people's hands.

 

[Stardom22]

For me I think credit is not good for the business. Every collapsing business that I have seen, they have one way or the other affected by either creditors failing to pay the businesses off or the business failed in paying back to its debtors. All in all credit is not a good thing in the business.

 

[Starmix]

That might happen if the business owners approve many applicants for credit. There should be limits and control. It is not good to keep on allowing them to purchase through credits.