Kreditrisikomanagement in produzierenden Unternehmen

Abstract

Manufacturing companies are increasingly confronted with challenging market conditions due to their strong dependence on the purchasing behaviour of their customers. As market conditions deteriorate, customers become more cautious with investments and demand extended payment terms. In times of a crisis the proportion of financially weak customers increases which leads to higher credit risk for manufacturing firms. At the same time, companies are under pressure to remain competitive which requires a certain degree of risk tolerance in their business dealings. The central question of this paper therefore is: How can manufacturing firms find a meaningful balance between risk-taking and risk mitigation in order to maintain business operations despite problematic relationships with customers? At the beginning of the paper, the concept of credit-risk and its relevance for companies in the manufacturing sector is explained. This is followed by an overview of key financial ratios used to measure and analyze credit-risk in manufacturing companies, as well as instruments to secure again bad debt losses. The analysis of these measures is based on a scenario analysis, which illustrates the mechanism of action of the individual isntruments in relation to typical credit-risk indicators. The aim is to evaluate the impact of these measures on credit-risk and liquidity. The scenario analysis reveals that there is no universal “best practice” instrument for managing credit-risk in manufacturing companies. Rather continuous risk monitoring using financial ratios is necessary in order to define appropriate countermeasures. Each risk mitigation measure affects credit-risk indicators, credit-risk iteslf, and liquidity in different ways. Instruments such as factoring or operational measures like adjusting payment terms have a positive impact on liquidity and can also increase profitability and in turn the company´s capacity to bear risk. Other measures such as trade credit insurance reduce credit-risk but have no effect on liquidity. Conversely, extending payment terms improves liquidity but does not reduce credit-risk. If external control measures are implemented, fees are incurred. They are recognized as expenses in the profit and are therefore reducing equity and ultimately having a negative impact on the equity ratio. A key insight is that manufacturing companies must constantly monitor their credit-risk and carefully weigh the advantages and drawbacks of available risk-mitigation tools. It is also essential to understand the interactions between credit-risk and liquidity. Only then a robust balance between risk-taking and credit-risk mitigation can be achieved, enabling long-term competitiveness, even in times of an economic crisis.

Date of Award	2025
Original language	German (Austria)
Supervisor	Christine Mitter (Supervisor)