Up until two years ago, if a customer had been around for a few years and was providing current financial statements, the credit manager of one large winter sports equipment company (who has asked to remain anonymous) could make a pretty good assumption that they had an operating line of credit with their bank. That's not the case anymore.

Now he's asking, as part of the "q-and-a session" when he's on the phone negotiating terms, all about the bank relationship. The customers may claim that everything is fine, but he can't be sure. When and if the plug is pulled and they're having difficulty getting money, his company may have to become the bank. "We have to be creative and stay flexible," he says. "But the problem is that, while we may have the resources to hang in there and stay patient and flexible as the customer scrambles to get an operating line in place again, other suppliers, who tend to be smaller and have fewer resources, can't afford to sit and wait.""

When and if the plug is pulled and they're having difficulty getting money, his company may have to become the bank.

Forcing Bankruptcy Filings - Although his company usually has the largest share of a customer's total buy for the winter season, stores still need to buy other brands to mix in and be successful. So the risk becomes the other suppliers getting impatient and chasing the customer legally. They may force a bankruptcy filing, opening up a can of worms in terms of exposure.

So he's careful and committed to carrying on with "very solid relationships" with customers' senior-level finance managers. He describes his approach as "not adversarial, but one of partnering." Especially in the past year, what he's been asking is, "How are we going to make this work? How can I help you and also achieve what I need to achieve?"

"At the end of the day,' he notes, "we still have to have people to sell to. If the current trend continues, we're going to wind up selling only to big e-com guys and big-box stores. The little specialty stops on the side of the road on the way to the hill or in the neighborhood are going to be gone. At that point nobody will be making any margin."