// Morrisons to extend immediate payments for small suppliers for a further three months
// The scheme was first announced in March and was due to end in May. It’s now extended to September
// The continued closure of the hospitality sector means many small businesses continue to suffer cashflow problems
Morrisons has announced plans to extend its scheme of making immediate payments to smaller suppliers for another three months as the coronavirus pandemic continues to linger.
The Big 4 grocer said the extension of the scheme will ensure its farmers, local food producers and other small suppliers will continue to be paid early and help with their cashflow as they deal with the closure of parts of the economy because of the pandemic.
Morrisons first announced it would make faster payments its small suppliers in March, but said at the time it would last until the end of May.
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However, the continued closure of the hospitality and food service sector means many small businesses continue to suffer cashflow problems.
The Federation of Small Businesses (FSB) also said many of its members were seeing payment terms lengthened by their clients as they deal with the impact of the pandemic.
This prompted Morrisons to extend immediate payments until September, and the move will benefit 3000 small suppliers – including 1750 farmers.
“Small foodmakers and farmers have helped us to play our full part in feeding the nation,” Morrisons chief executive David Potts said.
“They have told us they face continued financial pressure and we want to be there for them during this challenging period.”
FSB chairman Mike Cherry said: “Many small suppliers have seen their payment terms lengthened or cashflow held up as their big clients try to insulate themselves from the impacts of Covid-19.
“So it’s refreshing to see a large company like Morrisons championing prompt payment during this national emergency by extending its promise to pay small suppliers immediately.
“This is what good business looks like in these unprecedented times, and we need to see more positive action like this as the whole business community looks to get back on its feet.”
The extension of immediate payments by Morrisons will help businesses that provide up to £1m of turnover, including suppliers of local food and farmers that deal direct with Morrisons, such as those providing eggs and livestock.