Dell in late payment Hall of Shame

Dell in late payment Hall of Shame

IT giant Dell has earned its place in a late payment Hall of Shame after extending the time it takes to pay its suppliers by 15 days.

The company cited ‘current economic conditions’ as the reason for the extension in a letter to its suppliers.

However, the move appears to contradict Dell's latest results. Last week, Dell said it expects solid growth over 2010. It predicts revenue will increase 14% to 19% this financial year with non-GAAP operating income increasing 18% to 23% in the same period.

The Forum of Private Business, which runs the late payment Hall of Shame, slammed Dell’s decision to delay its suppliers' payments.

Forum spokesman Phil McCabe said: ‘Small businesses continue to suffer from the blight of late payment, which devastates cash flow and forces firms into administration. Companies like Dell have a responsibility to pay promptly – failure to do so can mean the whole supply chain seizes up.

‘When they receive a letter like this, smaller suppliers have no choice but to agree and stay silent. There is little room for bargaining. For the sake of small businesses and the economy the new Government must prioritise tackling the culture of poor payment, addressing the bully boy behaviour of these bigger companies.

A Dell supplier said: ‘As a ‘valued’ supplier of IT services to Dell I was dismayed to receive this notice via email regarding a change to their payment terms.

'Ironically, the reason for the change is apparently due to the current harsh economic climate. How is extending payment terms beyond the current draconian 50 days to 65 days going to help Dell’s legion of ‘valued’ SME suppliers, particularly when most of our suppliers demand 30 days net?’

Written by Mobile Today
Mobile Today


Please wait...

Please write code to prove you're human