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To produce goods you need raw materials, your supliers provide materials on credit and you have to repay them within the credit period. On the other hand, you provide credit to your buyers and you basically use this money to repay to your creditors. Now, obviously, if you take long to produce the money you get is also delayed and that would affect your working capital and you might need to go to a bank/lender for short-term borrowing to pay to your creditors.
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