The trade credit limit is established on an individual basis.
A trade credit is granted to trusted partners, and the limit depends on the assessment of the partner and any collateral he may provide.
Before granting the relevant credit level, an assessment is carried out in order to determine the level of risk associated with selling to a new customer or to a customer with whom the company has not collaborated for a long time, and a decision is made about the amount of the trade credit. This assessment is aimed at answering the following questions:
1. Will the customer’s financial situation allow him to pay his obligation on time?
2. Is the customer trustworthy (honest)?
It is not just the customer who is assessed, but also external factors in his surroundings.
We apply two methods:
The individual method involves checking each customer’s creditworthiness individually, and then establishing the individual credit terms. We do this when we sell goods in large quantities.
The systemic method - in the case of customers we have served before, we take into account the limit actually used, and the requested limit for new customers. We require up-to-date documents.
This method of dividing into categories enables the degree of involvement in collaboration with the customer to be linked with the scope of the economic information analysed and the forms of collateralapplied.
Every customer intending to commence collaboration, or already collaborating, with Szczepanki Mills may apply for a trade credit limit. The amount is determined based on an analysis of the customer’s credit risk, and on the requirements resulting from the potential extent of commercial cooperation. It is possible to increase the credit limit as the collaboration develops.
A trade credit limit can be granted after a positive assessment is provided by Szczepanki Mills.
This opinion requires:
1) submission of registration documents such as a company register entry, tax ID No., company ID (REGON), national court register, in the case of limited liability companies it is also necessary to provide a declaration by the Management Board of the ability to represent the company in light of Art. 230 of the CCC./ Art. 230 regulation of the right or take on an obligation to a benefit with a value twice that of the share capital requires a resolution to be passed by the partners, unless the company deed states otherwise.
2) With regard to customers with a good, stable market position, after receipt of the necessary documents (financial, registration, collateral) enabling a positive assessment of the financial situation and credit risk.
3) submission of the trade credit and limit application download.
4) with regard to significant limits, i.e. long payment deferment periods, after offering additional collateral such as a mortgage, warranty, transfer of ownership etc., and this being accepted by Szczepanki as adequate to the risk incurred.