The just-in-time philosophy, developed in Japan, is aimed at reconciling these often conflicting interests and keeping inventory costs to a minimum
On the debtor side, working capital is required to finance the gap between payment due to suppliers and payment owed by customers. It is the task of financial management to see that generous credit terms are negotiated with suppliers but minimal credit is offered tp customers. Again a balance must be achieved between getting and giving good credit term in order to attract customers and maintain relationships with suppliers on one hand, and minimizing cash outlay on the other hand
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