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Its George business, along with most of the big clothing chains, will have been hit by the falling value of the pound because it uses US dollars to buy most of its fashion lines. Pounds taken at its tills now buy fewer dollars because of the slide in sterling. Delaying payments to suppliers has become a common tactic used by retailers seeking financial breathing space. It boosts the cash in their businesses but hurts smaller manufacturers who are forced to wait longer for payment. Some have to borrow to pay staff and settle bills. In some cases it causes cashflow issues and can make the difference between the survival and failure. One Asda supplier, who asked not to be named, said: Asda already drives a hard bargain on price so this is all the more irritating in what are difficult trading conditions. We will have to wait another 30 days to pay our suppliers and staff. If someone delays paying us how are we supposed to pay our bills? Mike Cherry, chairman of the Federation of Small Businesses, said: Poor payment practices by big firms are responsible for killing off thousands of smaller businesses a year and threatening the existence of many others. This yet again highlights the need for a crackdown on late payments, which I hope will be top of the list for the governments new small business commissioner. Asda has been under intense pressure to reverse its fortunes after food shoppers flocked to discounters Aldi and Lidl and customers looking for cheap clothes migrated to Primark.
For the original version including any supplementary images or video, visit https://amp.theguardian.com/business/2017/mar/02/asda-suppliers-pound-brexit-george-clothing
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