Diageo and Anheuser-Busch criticised over supplier payments

Diageo and Budweiser brewer Anheuser-Busch have been criticised for extending the time taken to pay smaller suppliers.

Diageo and Budweiser brewer Anheuser-Busch (AB) have been criticised for extending the time taken to pay smaller suppliers.

Diageo has extended the period to 60 days. AB, now owned by InBev, has doubled it to 120 days and is staggering the amount it pays suppliers of capital expenditure projects, reports the Forum for Private Business. The group has urged the drinks giants to follow the Government's "prompt payment code".

Ruth Evans, chief executive of the Brewing, Food and Beverage Industry Suppliers, said: "This approach is totally unsustainable."

An InBev spokeswoman said: "The challenging global economic environment has resulted in InBev UK — like many other multinational companies — reviewing its terms and conditions of payment.

"Following this review, the company has concluded that it will change its terms of payment to 120 days.

"We value greatly the suppliers that we work with. 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 with the transition.

"We will continue to benchmark ourselves to best practices in the market."

A Diageo spokeswoman said: "In order to reduce complexity we have moved to one standard payment term for all non-contracted (occasional) suppliers. These new standard payment terms are 60 days.

"The standard payment terms for non-contracted suppliers in the UK & Ireland before this change were between 45 - 60 days. So, in the majority of cases, this is a maximum increase of 15 days. Where suppliers are unable to operate within these terms, we have advised them to contact us to discuss alternative payment terms."