OK, I accept that this is only for certain service lines and doesn't include component supply, but it is still a shoddy move and one that smacks of short term thinking and action that could lead to long term problems.
I am a customer of the company concerned and, in recent weeks, have been looking at buying from them again on two continents. They deliver what I've ordered on time and to specification, and their prices are OK, so I was fairly happy about going back to them again, both here and in the USA.
Supply chains are in fact more of a mesh, and being part of a supply mesh is just that; you are all linked. Yes you can break and replace a link, but, as a mesh, you become an entity and should behave with common interest. Any company can have a short term problem, and neighbouring links in the mesh will often be flexible with each other to share the load for the good of the whole. But that is a different argument to one link in the mesh deliberately passing load to other links. In that circumstance one of the overloaded links is almost guaranteed to fail and a hole appears that, in turn, overloads other neighbouring areas. As things go wrong, confidence in the mesh starts to fail. Other links fail and some decide to leave.
I say that this is short term thinking. Think of your own domestic outgoings. What If you decided not to pay any bills for the next month? Say that saved you two thousand pounds, but the next month you have to start paying your two thousand pounds again. There is no long term saving; you had an extra couple of grand for a few weeks, but now you're back on the same level of outgoings and your debt level has gone up. If it helped you round a problem and you can put some effort into slowly catching up then that's not so much of an issue, but just taking a payment holiday? No; not a good idea.
Times are hard at the moment, and there are two ways that we will get back to better times. One is innovation; being different about how we do things and the offerings that we take to market. The other is through collaboration, working together and looking after each other. I'm not talking about doing away with competition, I'm encouraging it, but there is a need for businesses to help each other where they can work together in serving the market. Where the relationship is contractual then delivering on time on the one hand and paying promptly one the other are crucial elements in making things work.
This is an often overlooked element of Corporate Social Responsibility (CSR). Businesses need each other as much as communities do to provide the way that the individual members of the community can support themselves. I talked earlier about supply chains being a mesh, but that applies to society as well. If businesses truly recognise CSR, rather than just ticking the box, then they have to behave in a responsible manner.
I cannot believe that the company whose payment policy started this thread here really need 65 day terms. They may not need the thousand pounds I was about to pay them either, but they won't be getting it now. A small protest at their actions perhaps, but their behaviour has offended me.
Source: http://www.thatconsultantbloke.com/
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