Question: While vendor discounts for early payment are very rewarding, what are some of the difficulties that may arise to keep a firm from taking advantage

While vendor discounts for early payment are very rewarding, what are some of the difficulties that may arise to keep a firm from taking advantage of those discounts?

Stretching payables has often been considered good cash management By delaying bill payments as long as possible without damaging the firm’s credit companies get interest- free loans from suppliers1 Other businesses deliberately increase their lag to cover temporary cash shortages.

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