New OZ, UK Retailer Accused Of “Supplier Bullying”.
Debenhams the UK retail store who will this week open an outlet in Melbourne ahead of a Sydney store opening has been accused of “screwing” suppliers and “supplier bullying”.
According to an email seen by the UK Sunday Telegraph the retailer is demanding steep discounts for paying small businesses within 90 days, which is double the industry average.
On top of this the Company that sells both consumer electronics, audio and appliances has also demanded a series of deductions from a supplier, including a 16.7pc discount on settlement of payment within 90 days, a deduction for every bar-coded item that had to be scanned, and a further carrier charge related to the delivery of goods.
UK suppliers are incensed by the retailers’ practises.
“To charge small businesses for paying on time is totally immoral, let alone for paying within 90 days which no one can consider prompt,” said Mike Cherry, national chairman of the Federation of Small Businesses.
The industry average for supplier payments is 42 days, according to the FSB. In Australia Amazon is telling suppliers that they will be paid within 30 days.
A Debenhams spokesman said that the retailer terms on average was 60 days. This week, Debenhams is forecast to report a 19pc fall in annual profits to $160M.
A spokeswoman for Debenhams Australia said: “At this stage, Debenhams wants 10 Australian stores within the medium term. It is currently in negotiations on tenancies; finding the right locations for its stores is the priority.”