Dell in late payment Hall of Shame
Small biz suffers from corporate sloth
Direct computer seller Dell has been entered into a late payments Hall of Shame for unilaterally adding an extra 15 days to the time it aims to settle invoices.
Dell wrote to suppliers telling them it was changing T&Cs from 10 July because of "current economic conditions". It will now settle invoices in 65 days rather than 50.
The computer giant has been awarded the dishonour by the Forum of Private Business.
A spokesman for the Forum said smaller companies had no choice but to put up and shut up when a big customer decides to change payment terms. He said it was time the government acted to stop the bully boy tactics of big firms.
Late payments by large organisations has been a campaigning issue for small business for some time - they tend to struggle with cash flow at the best of times, and most small companies have to settle their own bills within 30 days.
One in five FPB members said problems with late payments had become worse in recent months. On average FPB members said 36 per cent of turnover was tied up in late payments at any given time.
The Forum of Private Business set up the Hall of Shame to publicise the issue - previous entrants include Computacenter. ®
First sign of trouble
Purchasers lengthening their payment terms can be the first sign of cashflow and liquidity problems. The business savings are less than 0.1% so neglible. The only other reason is because of problems with cash management. Would worry me as a supplier.
Write them back?
Write them back and say "actually, 28 days for an invoice sounds enough. More than that and we'll take you to court"? Of course, this might mean that you get your contract cancelled, but having less turnover versus being driven out of business by Dell: I know which I'd take.
Dell are well known for being slow to pay............
And it is not just to smaller companies, it includes the likes of Intel. I have been sat in the reception of their HQ in Bracknell and witnessed baliffs coming in with the electricity supply company to disconnect their electricity for non payment of their bills, needless to say a cheque was presented pretty quickly. They used to have goods delivered to an outside building, and only started the settlement persiod from ythe time the goods entered the main building. This could be anything upto a month after the orginal receiving date!
Name and shmae them, not that it will make much difference.