Retailer Morrisons is to shorten its payment terms for its smaller suppliers to a maximum of 14 days.
From 1st April 2017, all goods for resale suppliers, whose business with Morrisons is worth up to £100,000 annually with Morrisons, will be paid within 14 days of receipt of a valid electronic invoice.
As a result, more than 3,000 suppliers will be on payment terms of less than 14 days.
Morrisons is also aiming to find 200 local suppliers as part of its ‘Nation’s Local Foodmakers’ programme and they could benefit from the change.
Darren Blackhurst, Morrisons Group Commercial Director, said: “We aim to buy and sell simply and when we listened to our smaller suppliers, they told us that these payment terms would help them with their cash flow. We want our smallest suppliers to grow with us.”
Suppliers who are already on payment terms that are less than 14 days, including livestock farmers, will remain on the same terms.
The moves aim to build on Morrisons’ ambition to buy and sell simply and follows on from other changes that have been introduced, including reducing the type of supplier income from 37 to three, removing or reducing many charges that suppliers pay and launching an independent whistleblowing service so suppliers may anonymously report concerns.
