M.Com. (Business Management) / The provision of trade credit in the course of business is one of the accepted norms of most business operations providing higher sales volumes, but also, a certain degree of risk. As part of the credit manager's responsibilities he/she must manage the credit department in such a way as to limit the extent of the inherent risk associated with trade credit thereby maximising the marginal profit flowing from credit transactions. Traditional management strategies and techniques do not take into consideration the level of the country's economic activity, to their peril. From the retail trader (Communicomp) example, it is clear that effective credit management procedures and well trained personnel are crucial to the management of trade credit. It is also noted that during a stage of lower economic activity the risks associated with the provision of trade credit are higher, and more likely to realise a financial loss whilst impacting negatively on cash flow. It is therefore appropriate that credit managers, should in future, adopt a management style which takes into consideration the state of the country's economic activity. This would ensure that the risks associated with providing trade credit is kept within acceptable limits.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:uj/uj:10564 |
| Date | 10 April 2014 |
| Creators | Meyer, Tielman Christiaan |
| Source Sets | South African National ETD Portal |
| Detected Language | English |
| Type | Thesis |
| Rights | University of Johannesburg |
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