Marketing Blog

Marketing Blog

Extended credit – good sign or bad!

One of our stockists informed me recently that he was being showered with offers of extended credit – 90 days, 60 days, around the world in 80 day deals! The offers were many and varied. extended credit offers in the toy trade

Strangely all the offers he was receiving were dismissed by the stockist. Why well of course it’s simple they were all from companies whose products just were not selling! The reasons for this were many and varied but included the fact that the products were of little interest to shoppers or they were being sold by the supplier on Amazon (I can feel another blog required on this subject alone!) and as a result he was not prepared to sell the product at such low pricesĀ  – he has now dropped the latter as a supplier and the gains that the supplier may have made from Amazon sales have all vanished as stockists drop them abruptly.

This is a story we are hearing more and more of…..unfortunately for those suppliers who are offering such credit terms, their continued presence in the market could be very short lived as extended credit increases cash flow problems and eats into profit through the cost of lending to support such activities…I would not be surprised if we lose some suppliers to the UK market unless these suppliers take some quick and positive action to make their product more desirable. It’s a shame because some of the suppliers are major names who have been around for many many years.

So what can we learn from all of this? Well suppliers review your product lines and make them more desirable for the target market. Also ensure you look after your bricks and mortar customers or your profit margins will continue to be eroded. And what about retailers? Whilst extended credit terms sounds attractive, if the stock is left sat on YOUR shelves the problem has been passed to you – so don’t do it!

If you have any comments to make on the above email Paul James at