The role of supplier credit in reviving the activities of very small enterprises in the post-COVID-19 period

To restart or develop their activities after the COVID-19 crisis, many micro-entrepreneurs turned to supplier credit to compensate for the rationing of bank credit. This study aims to analyze the effects of supplier credit on the performance of very small enterprises (VSEs) in a post-COVID-19 context in Cameroon. A questionnaire survey was carried out in August and September 2022 among 472 promoters operating in the Sudano-Sahelian zone of Cameroon. The data collected was purified and analyzed using the multiple linear regression method. The results clearly show that the amount of supplier credit and the payment period granted positively influence the performance of VSEs. However, the costs associated with supplier debt tend to exert a negative influence on this performance. Based on these results, we suggest that promoters of VSEs seeking to restart or expand their activities after a crisis should strengthen their relationships with suppliers to benefit from larger credit, longer payment terms, and lower financing costs. This study enriches the theory of hierarchical financing by prioritizing debts within a company.