For months, Chinese glove manufacturers have struggled to secure loans as the government worked to control inflation. To maintain cash flow, most were forced to adjust payment terms with customers. Vendors who previously granted credit of 45-60 days suddenly now allow only 15 days or less. Some have gone as far as to require prepayment.
The effects of tightened lending have been equally challenging for suppliers. With increased demand and shrinking supply, companies like Tradex have proactively worked to increase safety stock. With greater inventory and shortened credit terms, however, suppliers now face many of the same cash flow first felt by manufacturers.
Comments Off
