Study On Trade Credit Scale Decision Of Company Basing On The Views Of Self Credit

Trade credit include two sides, other firm and the firm himself. They all have the possibility of incredit. Which bring about the trade credit risk. The causes of risk maybe:â‘ losing of decision;â‘¡on prupose;â‘¢irresistible reason. And the reason about losing of decision are:â‘ has no aware of risk;â‘¡losing of working;â‘¢be short of ability and methods about risk.The target of this paper is to make progress of study and method about credit risk. It would improve the comprehention and bility of firm to credit risk. Which cause the firm self-rule. So the firm can be well prepared for the potential danger. Therefore,it is academically and practically meaningful of this paper.It is important to company to study the right scale of trade credit by the self credit. Which can deal and control the liquidity risk of trade credit. According to the finance management and system thinking, we make the math model of trade credit. By practise analysis of SEM model, we finish the system decision of trade credits cale. The rults proved that there has the right credit scale to firm. Then we make the model of scale assess and the target system in order to supply the trade credit scale decision.The great innovation of this paper include:â‘ This paper selected to study right credit scale of firm base on the self credit, different from the study of other sight. The key point is firm how to deal and control the trade risk not to keepwatch. Which basing on the finance management but mot the same.Which could make firm self-rule, help firm bring about the long-time object of getting well honor.â‘¡Following the guide of systems thinking, system model and SEM model were built to analysis the character of trade credit. What can be get by the analysis is there exit right scale of trade credit. And wo also get the target system of right credit scale assess. It could be a guide for company to perfect the trade credit management.â‘¢It proposed the policy advices on advancing the trade credit scale decision. Such as to coordinate the theory value and fact.The study indicated that:â‘ Making progress of comprehension about trade credit. Study angle of trade credit was changed first, the angle about this article was"self credit", which could perfect the understand about trade credit. Then different character trade credit were put into one system, which perfect the thinking about trade credit by system thinking, and become a reference for company to using trade credit.â‘¡For optimization trade credit using of company.The result of theory and practice analysis make a reference for firm of trade credit scale decision. The results of analysis mean that there exit right scale of trade credit. trade credit scale decision was effected by many of factors and had the fit scale. And wo also get the target system of right credit scale assess. It could be a guide for company to adjust and perfect the trade credit scale.