Asda is reducing its payment terms for small suppliers to 14 days as part of ‘ongoing efforts to work more effectively’ with its supply base.
The move will benefit around 1,200 small suppliers with up to £250,000 worth of business with the supermarket chain, which owns the George Home brand. The new terms became effective on June 1 for the first group of around 430 suppliers.
A spokesperson for Asda said: “Our relationship with our suppliers is vital to ensuring that we do the best job for our customers. We continue to focus on building strong partnerships with our suppliers, many of whom have been with us for decades.
“We’re always looking at ways we can work more effectively together and we believe it’s the right thing to do to reduce our payment terms to 14 days for our smaller suppliers.”
The scheme adds to a number of mechanisms that Asda has in place to support its supply base, including simplifying its terms and conditions and providing access to early payment finance options.
Asda also runs a ‘sustain and save’ programme that works with businesses to become more efficient and reduce their operating costs.
In addition, the retailer recently launched an app that allows its suppliers to share and swap excess products with other companies who may be able to make use of them. This programme was recently rolled out regionally to lend further support to local suppliers.