Large Companies use SMEs as unofficial credit source

The chairman of the Federation of Small Businesses (FSB) has accused large companies of using small firms as an unofficial source of credit. The criticism follows Alliance Boots’ announcement that it has extended its invoice payment terms so its small–business suppliers will not get paid for more than 100 days. Alliance Boots, the company behind high–street chemists Boots, wrote to its suppliers in June to inform them that as of April 2008, bills would be paid up to 75 days from the end of the month of invoice – instead of the 30 days previously agreed. In addition, the company introduced a 2.5 per cent ‘settlement fee’ – a charge for paying the bill. “At a time when small businesses are finding it difficult to deal with a slowing economy and... »