Raising money to fund businesses, especially for starters, petty traders, SMEs, and head and tabletop traders, can be very challenging. These types of businesses most often do not have easy access to traditional banks to access loans to support their businesses.

Even where they have consistently operated an account, thinking after a while, the bank will look at the movements of funds in the accounts and support their business, they cannot meet the demands for collateral and guarantees from the banks.

Can you imagine looking for a little money to fill your shop or buy some raw materials to enable you to meet an urgent order from a customer that can earn you a substantial profit and the bank will turn you down in the name of “you don't qualify for loan”? Yet they will always accept your deposits. A lot of small businesses face frustrations in accessing funds from these savings and loans.

Even if they get the opportunity to access a facility, they do so at exorbitant interest rates. It is more frustrating when the bank advises you to open an account with them and operate it for about six months, with the promise of granting you some short-term credit, and they do not make good their promise, because you cannot meet the other requirements for the loan.

Well, you cannot blame the bank entirely because they play the game of risk and return and they always want to play it safe. They are always doing business with other people’s funds. If they lend you the money and you are not able to pay, it becomes an albatross on their necks, and the banks would want to minimize that, if not avoid it entirely. The banks are not all that interested in startups or crawling businesses, looking for money to turn it around, they want to do business with thriving companies.

So, how can SMEs, Startup businesses, and head, and tabletop traders get funds to support their businesses? That is where suppliers' and service providers credit can be of great help. Businesses of all sizes benefit immensely from suppliers and service providers' credit.

Suppliers' credit covers a broad spectrum of business inputs. It could be a raw material supplied to a manufacturing company on credit for a certain number of days. It could be the supplier of diesel or petrol to a transport or logistics company. It could be a supply of finished products to the supermarket on credit for some number of days. It could also include the supply of data by the telcos on credit for 60 days or even electricity to manufacturing companies on credit for some number of days.

Even government institutions enjoy suppliers' and service providers' credit. Suppliers and service providers' credit for a long time played a significant role in both private and government businesses worldwide. It assists companies, businesses, individuals, and groups to buy on credit and pay later. More importantly, it frees cash flow and helps to invest in growth. But suppliers' credit does not come easy. Serious companies will set up stringent assessment criteria to prequalify potential customers.

It is only after you have been successful with the assessment that you will be granted credit for a certain number of days. For well-established companies, the assessment is usually easy to pass because of the existing reputation and track record. For others, extra vigilance is required to ensure that people do not take advantage and abuse the opportunity extended to them.

There are some character traits and factors that people will look beyond the paper assessment. And these factors are more important than the paper assessment. We will discuss briefly some of the factors that will convince suppliers and service providers to grant you credit.

Prompt payment

No serious company jokes with a payment schedule. If you appreciate the role of suppliers and service providers in your business, you will prioritize payments and meet deadlines. So, learn to honour your payment deadlines. If you have been in business for a while; you might have received credit or service on credit over time.

Your ability to honour payments when due promotes your credibility as a businessman to qualify for further credit supply. If there is anything that will hinder prompt payment of your debt, do not wait until the due date before you inform the supplier. Always make sure you pay on time and if you cannot for genuine reason, communicate ahead of time. In doing so, you are building a reputation for big credit facility.

Basic record keeping

Whether you are doing a tabletop or Head top business, you need to maintain basic records of your activities. If you are an SME or a supermarket, a wayside fruit seller, or a food vendor, basic recordkeeping is a necessity. You must maintain records of your startup capital, daily sales, expenses, and inventory. You must prepare a simple statement of income and expenditure to know whether you are making a profit or not.

If, perchance, you cannot maintain records because you don’t know how to, get somebody to assist you. Keeping the records will help you to know how much you can sell in a day, a week, or a month and also help you to determine how much you can pay if you get goods on credit. It is always a crucial part of the assessment criteria for granting credit.

Regular inventory exercise

Taking inventory is very crucial for shops, manufacturing companies, supermarkets, tabletop businesses, and even food vendors. Inventory is an asset that cannot lock up your capital if you fail to manage it well. It does not matter the size of your company, if you hold inventory for any purpose, it is advisable that you take stock and maintain adequate levels for your business.

A lot of shops lose money from expired products and some even end up being charged penalties by the Food and Drug Authority for keeping expired goods in their shops.

Charge the correct price

Pricing in every business is very critical. Amid rapid changes in exchange rates, if you have to sell goods received on credit and pay in foreign currency, your pricing model must be flexible enough to accommodate the changes in the forex rate and still make a profit to stay in business. You have to devise a means to receive updates on the prices of goods and services. You must also keep in touch with your suppliers to get information that will be relevant to your pricing in subsequent supply. Failure to price your items well is a plan to incur losses and throw your business out of the competition.

Demonstrate personal integrity

Personal integrity is an essential requirement for gaining a good reputation in society. People must be able to trust you. They must be able to say at any time, your Yes is Yes, and your No, is NO. In business, people look out for faithfulness in people before they decide to deal with them, especially on credit terms. You may use your oratory and cunning tricks to get people to supply on credit, but once they discover you are not what you say you are; you are finished. If you disappoint a supplier, he will inform others. The news of your dishonesty will be spread among their network. So as a business starter, you must demonstrate to people that you are a man of integrity.

You may not know, that both suppliers and service providers observe you through your speech and actions. They observe your consistency no matter the circumstances. If you are a businessman, you may know that some people will get goods on credit for any amount they want. Others may not get a kobo worth of goods on credit. Why? they have failed the integrity test. Your integrity affects your reputation. If you lose your reputation because of dishonesty, it will be difficult to rebuild it. Your integrity and reputation represent an unseen force that attracts people to do business with you.

In conclusion, people do not just decide to offer goods and services on credit. They go through proper assessment procedures. Once you are qualified, you will be able to receive a credit supply and free up your cash flow for other things. You need to keep proper business records, honour your payments when due, carry out regular inventory exercise, build a proper pricing model, and more importantly, let your yes be yes and your No, No.