120 days for Mars to pay, says FPB
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The Forum of Private Business has raised concerns about the payment practices of the confectionery giant Mars, which is reportedly enforcing payment terms of up to 120 days on some suppliers.

 

 

As a result, suppliers face a four-month wait to receive their funds, unless they choose to release the value in those invoices using a method such as invoice finance.

 

Phil Orford MBE, chief executive of the Forum of Private Business, says this is not fair – and that the existence of supply chain finance schemes should not be used as an excuse to fail to pay promptly.

 

He said: “Whilst the Forum of Private Business is a great supporter of supply chain finance schemes in the right circumstances, they should not be used as a justification for a company extending payment times to its suppliers.

 

“We are concerned to learn that MarsUK is doing just this, extending payment times up to 120 days for some of their suppliers.”

 

He also pointed out that accessing funds through invoice financing comes at a cost, meaning the supplier effectively pays a premium for receiving their money sooner.

 

For those who are unwilling or unable to pay this premium, the only alternative to receive 100% of the amount owed is to wait the full 120 days for payment.

 

This leaves small businesses effectively being used as a line of credit by their bigger customers – something Mr Orford said is particularly unfair at a time when the economy as a whole is growing.

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