National/Multinational businesses using minimal credit

Factual Questions
1

For years, whenever I’d hear talk about credit, and over reliance on it, I’ve pretty much always heard it talked about in terms of individuals.

Last year when credit froze, and a lot of businesses had problems with day to day operations, even paying payroll because a lot of businesses pay them with loans, I was shocked on how reliant businesses are on credit. Before that, I thought that businesses used credit sparingly.

So I’m curious now, is it possible for a business to become a national, or even multinational, living predominantly on profits? Or once you get that big, do you have to rely heavily on credit?

2

Many companies do live predominently on profits. But here’s the problem: You have to pay your workers and suppliers now, and you only get your profits later. Many (most?) large companies solve this problem by taking out short term loans that are paid back when the goods or services are actually sold.

Ed

3

More to the point, it’s more efficient to use (a certain amount) of credit. Shareholders of a company want to maximize their return on investment, and borrowing to finance operations can do that.