Calling the shots in the aisles
Morrisons today announced it would shorten payment terms for its smalle suppliers to a maximum of 14 days as part of its ’buy and sell simply’ initiative.
With effect from 1 April 2017, all goods for resale suppliers, whose business with Morrisons was worth up to £100,000 annually, would be paid within 14 days of receipt of a valid electronic invoice, said Morrisons, adding more than 3,000 suppliers would be on payment terms of less than 14 days as a result.
The supermarket said it aimed to find 200 local suppliers as part of its ‘Nation’s Local Foodmakers’ programme who would benefit from the change.
The move followed the retailer’s smaller suppliers telling Morrisons such payment terms would help them with their cash flow, said group commercial director Darren Blackhurst.
“We aim to buy and sell simply and we want our smallest suppliers to grow with us.”
In addition, Morrisons is developing a free-to-use supplier portal through which invoices can be raised and submitted in a bid to help small suppliers that don’t currently have electronic invoicing system. The service is expected to be introduced later this year.
Other changes introduced as part of the retailer’s strategy to “buy and sell simply” include reducing the type of supplier income from 37 to three; removing or reducing “several” supplier charges; resolving all cost price invoice queries within five working days and a ”simpler standard supply agreement” for adoption this year.
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