Advantages of Selling on Credit

by Thando
(Johannesburg)

What are the advantages for a business selling goods on credit?



Comments for Advantages of Selling on Credit

Click here to add your own comments

Benefits of Selling on Credit
by: Michael Celender

There is one main advantage and always will be one main advantage for selling on credit: MORE SALES (AND INCOME) FOR YOUR BUSINESS.

This is very simple - if you offer customers the ability to pay you back after some time has passed then more customers will buy from you. The customers who don't have cash can still buy - they just have to pay you later for the goods.

There is a downside to this though - the more sales you make on credit, the more you are exposing your business to risk - the greater chance that some of your customers will not pay you later. To manage this risk, businesses often check a customer's credit history and use other methods to establish their creditworthiness.
ASSETS
by: KETU

To increase business current assets by increasing your debtors. This will also make a business have a high current ratio which will show that its easy for it to pay its short term debts.
advantages
by: Nova

In need of it

Click here to add your own comments

Return to Ask a Question About This Lesson!.



Enjoying this Website?
Help Support it with a Donation

OR...

Advertise on Accounting-Basics-for-Students.com

© Copyright 2009-2016 Michael Celender. All Rights Reserved. Click here for Privacy Policy.

SBI
SBI!

privacy policy