As banks have cut back on lending to businesses - especially small business - the role of trade credit
has become more
important to the channel. This article explores how distributors are balancing the risk of economic uncertainty with the need
to use trade credit to grow sales.
Having up to 90 percent of a company’s customers reliant on distributor financing is not uncommon in the wholesale
“Around the world, as commercial lenders have cut back on lending money to business, we’ve seen companies step
forward to make up that gap,” says Abe WalkingBear Sanchez, founder and president of A/R Management Group, a consulting
firm focused on cash flow management and credit sales.
In some sectors, such as those that serve construction end-markets, distributors have seen an even greater need these services
from their customers.