Bestseller offers “early and immediate” payments to suppliers
7 Jul 2020
Danish fashion group Bestseller is immediately releasing payments on current orders to its suppliers, as well as implementing early payments until October, to ensure its suppliers' cash flow and help them through the coronavirus crisis.
In a statement, Bestseller said: “Over the past four months, we have all faced significant challenges and disruptions due to the global Covid-19 pandemic, and we have all had to make difficult decisions in order to protect our colleagues, our partners, and indeed our supply chain.
“It has been necessary for us, due to lockdowns across the world, to adjust our business and indeed our inflow of goods. Our own order intake and own revenues have been hit hard, at times being close to zero, but we have tried our very best to minimise the impact passed on throughout our global supply chain. Due to our long-term commitments and close cooperation, we have supported each other and secured our mutual businesses’ immediate future, for which all of us at Bestseller are thankful.”
The group, whose brands include Vero Moda and Jack and Jones, went on to explain that its “closeness” with its supply chain partners is something that they are proud of, and they see them as a “critical part” of its foundation and an “enabler for future development”.
To assist its suppliers through the coronavirus pandemic, Bestseller has stated that it will immediately pay all current invoices early, “regardless of the date of invoice” as it feels that by releasing payments early it will instantly strengthen its suppliers’ cash flow.
In addition, over the coming three months, orders with Cargo Closing dates in July, August and September, will be paid with immediate effect implementing “TT10 days”. This applies to all orders living up to agreed Cargo Closing dates. As of October 1, the company will revert to standard payment terms TT90 days.
“We trust that providing this immediate cashflow will, in the best possible way, enable our partners to do even better business with us, while helping all our suppliers meet their commitments,” explained Bestseller.
Bestseller puts plan in place to support suppliers during the coronavirus pandemic
The fashion company goes on to add that while it still expects disruption to continue it feels that its approach to continue to pay all of its suppliers, which it has done since the beginning of the Covid-19 pandemic, as well as make a commitment to accept delivery of orders already made and those in production and continue to submit orders, will “safeguard” as many jobs as possible.
Bestseller added: “We have maintained a close dialogue with all our suppliers to understand their situation, and to find the best way forward for our mutual business. There will always be room for improvement. We continue to be motivated to improve our supplier collaboration and to strengthen our supply chain. This also means that we must accelerate the planned consolidation of our supply chain and unfortunately, that will mean reducing the number of suppliers that deliver to us.
“Our industry does operate in less developed regions where regional structures on labour law implementation are less developed. We work with a global supply chain team of 40 colleagues, who work closely with our suppliers to secure working conditions and to work on continuous improvements. We do expect the disruption caused by the pandemic to continue and it is therefore imperative that we as a brand and as a partner to suppliers in developing countries, continue to work on improving supply chain working conditions – and setting a long-term focus on improving with our strategic supplier partners.
“We will continue to reach out to all regional stakeholders, NGOs, labour unions, governments and employer associations, to support the development of stronger systems in all regions where we operate.”
The fashion company also added that it is endorsing the Covid-19: Action in the Global Garment Industry initiative that has been developed by the ILO, IndustriAll and other relevant global stakeholders. This commits Bestseller to take action to protect garment workers’ income, health and employment and support employers to survive during the Covid-19 crisis, and to work together to establish sustainable systems of social protection for a more just and resilient garment industry.
Image: courtesy of Bestseller