What happens if there is no working capital?
Establishing strong internal procedures and controls can help a company build creditworthiness. It includes monitoring cash flow and using sound accounting techniques such as double entry bookkeeping. To demonstrate reliability and trustworthiness, companies should build positive relationships with vendors. Establishing lines of credit or other financing vehicles with reputable institutions is another way to improve one’s creditworthiness as it shows banks that the company is able to manage money responsibly. To further prove their financial stability, companies can try to obtain trade references from customers and suppliers who are satisfied with their services.