Trade credit, quality guarantees, and product marketability.
YU Author ORCID
YU Faculty Directory
MetadataShow full item record
Scholarly article / Open Access
Although trade credit has long been an important source of financing for corporations, it is one of the least understood methods of doing business. One possible reason for misconceptions about trade credit is that it is not primarily financial in nature, but instead reflects production and marketing decisions. In this paper, we consider trade credit as a way that firms can guarantee product quality, rather than as a means of financing less creditworthy firms. In this context, we seek, and provide, possible explanations for observed phenomena such as relatively shorter (or no) trade credit terms for consumer and food products and relatively longer terms for heavy industrial equipment.
Ravid, S.A., Long, M. & Malitz, I.B. (1993, November). Trade credit, quality guarantees, and product marketability. Financial Management, 22(4), DOI: 10.2307/3665582
*This is constructed from limited available data and may be imprecise.
The following license files are associated with this item: