What is a trade reference letter in textile wholesale? When do suppliers ask for one?

A trade reference letter is a formal endorsement from an existing supplier or business partner — confirming that the buyer has a positive track record of timely payment and professional business conduct.

When Surat suppliers might ask for a trade reference:

• When a new buyer requests a credit period (payment after delivery) for the first time
• When a new buyer wants to place a very large first order (above ₹50,000–₹1,00,000) without prior relationship
• When a supplier has had bad payment experiences and is implementing stricter screening

How to provide a trade reference:

• Ask an existing supplier with whom you have a good payment history to provide a short letter confirming your business name, duration of relationship, and payment reliability
• Your bank can provide a bank reference letter — confirming your account standing
• GSTIN registration itself is an implicit credential — a registered GST business is more credible than an unregistered buyer