Supplier credit

The supplier credit is characterized by the fact that goods are delivered to customers that they only pay for later. For the period between delivery and payment, the customers have outside capital in the form of goods. Corresponding claims, which are also referred to as outstanding debts, arise from the supplier.
When selling goods against subsequent payment, the supplier provides two services at the same time:

On the one hand the delivery of goods and on the other hand the granting of credit.

The delivery of goods is the main service here. The credit is an additional service that is offered to customers in order to promote the sale of the main service. The active supplier credit is therefore a means to the purpose of sales promotion, ie an instrument for B-to-B marketing.

Example: Stahlbau GmbH has agreed with its supplier that it does not have to pay its invoices for delivered sheet metal until 30 days after receipt. In the course of the business relationship, the supplier also grants the GmbH a loan of 150,000 euros so that it can rationalize its warehouse.

The supplier credit can therefore be:

a) Credit for goods Here, the credit granted by the supplier is related to a delivery of goods.

b) Financial credit The granting of credit has nothing to do with a delivery of goods.

Advantages of the supplier credit

For the supplier, the advantage of the trade credit is that the buyer may buy larger quantities; the advantage for the buyer can be seen in this. that he goods - in a tense financial situation z. B. - can buy without taking out a bank loan and sell the purchased goods until the payment date is reached and meet his payment obligations with the proceeds. In addition, the supplier credit is usually granted without any major formalities. However, and this is its disadvantage, it is an expensive loan.

Der Verzicht auf kreditpolitische Aktivitäten müsste durch den verstärkten Einsatz anderer Marketinginstrumente ausgeglichen werden, vor allem durch die Discount policy. Dabei ist zu beachten, dass sich Kredite nur teilweise durch höhere Rabatte ersetzen lassen.

The granting of credit triggers purchase decisions that would not be made at all or not to this extent without this additional service. Anyone who only sells for immediate payment excludes those buyers as customers who cannot or do not want to meet this condition.

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