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Message: RE: My KISS philosophy scenario....TK

RE: My KISS philosophy scenario....TK

posted on Jul 15, 2005 05:35PM
I think the up front money from Wencor is way more than enough to kick off action by the manufacturer. Remember that most large manufacturing entities demand nothing up front other than a contract and a letter of credit (which refers to either the buying entity`s moneys in hand or in the form of accounts receiveable - basically a letter from a banking institution stating that the buyer - EDIG - has an ability to pay).

Further, payment terms vary, but typically the manufacturer will give you 30-60 days after delivery to make full payment, and offer the option of paying even later but for a nominal added (interest) fee. Sometimes they call it a ``discount`` for early payment if payment is received within 30 or 60 days. Works out the same though....

In big business, they understand that money is moving from party to party with associated delays, and set up their accounts receiveable systems accordingly. If everyone in the food chain always had to fully pay for things up front, all business would grind to a halt.

And this ``system`` works its way down. How does the digE manufacturer pay for the raw materials to build product? Same scenario....

SGE

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