UK: InBev stands up to payment term switch attack

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InBev has defended itself against charges that it has unfavourably changed payment terms in the UK for its suppliers in the country.

The Forum of Private Business (FPB) said late last week that the brewer has changed payment terms with suppliers from 30 days from the end of the month of invoice to 60 days.

"Not only was this decision taken without the consent of InBev's suppliers but also they were given less than a month's notice of the change," the FPB's executive chairman, Len Collinson, said. "Many suppliers of the firm will find it difficult to adapt and will have problems with their cash flow.

"This is an abuse of buying power. Suppliers are unlikely to stand up against such unilateral action on payment terms for fear of losing InBev's custom completely. They will have no choice but to accept these changes and the consequences for their firms."

Citing a letter from the brewer to its affected suppliers, the FPB said InBev believes the move would allow the company to "… place maximum efforts in connecting and investing in our consumers and therefore develop further our ability to offer the potential of long-term sustainable business growth with our suppliers."

Collinson countered, however: "This is nothing short of making suppliers pay for savings at InBev. To try and pass it off as in the best interest of suppliers in the long term is particularly galling."

When contacted by just-drinks today (11 June), however, a spokesperson for InBev UK said: "We can confirm that we have changed our payment terms for reasons of consistency and standardisation across our whole business in the West of Europe. Sixty-day payment agreements are not unusual across some parts of Europe.

"We value greatly the suppliers that we work with and we've had positive conversations about this with the majority of them. It may take time for some of the suppliers to get used to the new system but we will do what we can to help them over the coming months." The spokesperson declined to go into specifics of how the brewer could assist suppliers.

Sectors: Beer & cider

Companies: Anheuser-Busch InBev

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