Why Do Large Companies Abuse Their Smaller Suppliers

[barney15c]

It seems the bigger a company is the more it will abuse the relationship it has with its smaller suppliers. When these companies can well afford to pay a company promptly to they continue to swing the lead and take an inordinate amount of time to settle their bills and in some cases ask for payments from their suppliers just to continue to do business with them. Its just corporate greed taken to a higher level.

http://www.bbc.co.uk/news/business-30868557

[Cloverjo]

They do it because they can. I don't know why, except that they're greedy and want to squeeze every last drop out of whatever they can get. The interest they might gain on withholding the payments must be minimal. I suppose the companies they deal with have to kowtow otherwise they won't get the business again. The government should do something about it.

[hc4361]

Farming is a good example of this. The supermarket contracts with a farmer to buy a huge amount of a certain crop, farmer grows crop then supermarket offers a much lower price than agreed, for whatever reason. Farmer has a choice, sell for the lower price of try to find another buyer very quickly for a huge amount of deteriorating crop

[ummmm]

Yep...when I ran a business it was always the big companies that caused us ball ache.

They also try and dictate payment terms. Good for their book keeping but bad for small businesses cash flow.

[rockyracoon]

Local Authorities are every bit as bad for this carry on as well.

[baza]

Years ago companies would pay out on a certain date ( 1st of the month), should that fall on a Saturday or Sunday they would pay on the Monday never the Friday before, now they pay when they think they will with no thought to their suppliers finances. A very I'm alright Jack attitude.

[Canary42]

Market Forces operating as its supporters intend.

[MargoTester]

It's been going on in the motor manufacturing trade since (at least) the 1970's