It seems a change in Dell’s payment terms could put some of its smaller suppliers at risk.
The Forum of Private Business has put Dell into its late payment Hall of Shame after the company extended the time it takes to pay suppliers by 15 days.
Dell, wrote to tell what it called its ‘valued’ suppliers that it is ‘standardising’ its payment terms from 50 to 65 days from 10 July, citing ‘current economic conditions’ as the reason for the change.
Dell enters the Hall of Shame with the likes of Argos, United Biscuits and Carlsberg.
“Late payment causes serious cash flow problems for small firms, many of which are still struggling despite the UK’s economy entering a fragile recovery.
Th Forum’s says, almost one in five small firms (18%) said the problem of late payment and changes to payment terms and conditions has become worse. On average, 36% of respondents’ turnover is tied up in late payment at any one time.
I wonder if Dell will be open to its outsourcing customers changing their payment terms.