Suppliers' payment terms can be 'worse than the supermarkets'

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Related tags: Payment terms, Receipt, Business development

A campaign against retailers extending payment terms has been criticised by one ingredient supplier that claims "manufacturers are sometimes worse...

A campaign against retailers extending payment terms has been criticised by one ingredient supplier that claims "manufacturers are sometimes worse offenders than the supermarkets"

A petition to introduce a maximum industry standard contractual payment term of 28 days from receipt of invoice is on the Number 10 Downing Street website and has more than 150 signatures.

However, the supplier said extending payment times had become common. "Manufacturers were often insisting on 60 days from end of month, which I believe is longer than some supermarkets." As a result, he added: "Many manufacturers will probably not sign up."

Graham McQuade, new business development manager at The Kerfoot Group, another ingredients supplier, who lodged the petition, said: "Sometimes they [supermarkets] insist on terms of up to three months, when suppliers or providers would have had to pay for their goods in 28 days or sooner. Companies are being squeezed ever tighter and forced to support large companies that are continuing to post huge profits."

One supplier said his employer paid invoices within 28 days, but that supermarkets "often abused their power". Despite "suppliers having clearly written payment terms, including late fees, they are usually too worried to press the issue for fear their status and shelf space will be adversely affected"

l For more news on payment terms see article p61

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