Endeavour Drinks has moved to assist small suppliers affected by COVID-19 by reducing its payment terms to a maximum of 14 days.
In a letter to suppliers, Endeavour Drinks’s General Manager – Buying & Merchandising, Adam Fry, said small suppliers are eligible to payment terms that “will not exceed 14 days from receipt of a correct invoice or receipt of goods (whichever is the latter)”.
The drinks retailer that includes the Dan Murphy’s and BWS chains defined a small supplier as Australian-based suppliers that receive net payments from the company of less that $1 million excluding GST per annum.
This automatic reduction to payment terms to eligible suppliers will continue until the 30th June 2020 and will then be reassessed.
The moves comes as Brews News has been hearing from brewers and small retailers about the pressures on cash flow through the retail chain, as well as the pressure on small retailers as brewers chase payments.
Before Endeavour Drinks change of policy one small brewery wrote to Brews News advising that it had contacted its major retail partners and managed to get significant outstanding payments unlocked immediately.
“For us its has made a massive difference to our cash flow,” the brewery representative who asked not to be named advised.
“The request was simply an email to the category manager too, they didn’t ask for any paper work to be completed or anything.”
While Endeavour’s automatic change is for small suppliers, the letter advisers suppliers that they if they are not eligible for the temporary change to payment terms, and are experiencing hardship or particular difficulty, businesses should contact their respective merchandise manager.
We understand this is a challenging time for many and hope this additional support provides your organisation some assistance through these unprecedented times. Please contact your merchandise Manager or reach out to us at [email protected] if you have any questions or concerns with this temporary change in terms.
Articles published under the media release byline are news produced by the relevant business and remain unedited by Brews News.
In recognition of the economic uncertainty many of its small business supplier partners are facing, Woolworths Group will temporarily change its payment policy to pay small suppliers faster for their goods and services.
Currently small trade suppliers in Woolworths’ Supermarkets business are paid within 14 days, while across the rest of the Group, payment terms for small suppliers do not exceed 30 days from receipt of a correct invoice or receipt of goods.
From today, the payment terms for eligible small suppliers will be aligned across the entire Group (including Goods Not For Resale, BIG W, Endeavour Group and New Zealand) and will not exceed 14 days.
Woolworths Group Chief Financial Officer Stephen Harrison said: “Our small business suppliers are an integral part of our supply chain and play a key role in helping us provide the products our customers need.
“We recognise that right now many of our small supplier partners are facing additional challenges in the current climate and we want to do our bit to further help them out by shortening payment terms across the Group.
“By paying our small suppliers faster, we hope to ease some of the financial pressure many of them are currently experiencing amid the uncertainty caused by the coronavirus pandemic.”
This change will have a positive impact on more than 1,100 small suppliers, providing goods and services to Woolworths Group businesses.
In line with the Business Council of Australia, Woolworths Group classifies small suppliers as businesses with $1million purchases by Woolworths and less than $10million annual turnover
Stephen Harrison concluded: “We understand this is a challenging time for many and we hope this additional support provides our suppliers with some assistance through these unprecedented times.”
Woolworths Group revised Small Business Policy will continue until the 30th June 2020 when it will be reassessed based on the situation at that time.
The move follows the announcement last week that Woolworths will offer rental relief for its tenants in its 28 owned shopping centres and other retail assets throughout Australia.