IPSE, the Association of Independent Professionals and the Self-Employed, has today reacted to the news that supermarket price wars are having serious negative impacts on small scale supermarket suppliers.
Analysis of financial data has shown that the number of ailing small businesses which supply the big supermarkets has grown by 120%, while suppliers facing significant financial distress – meaning those facing legal claims or unpaid bills – has increased 94%.
Andrew Chamberlain, Deputy Director of Policy and External Affairs at IPSE, said:
“Late payment is frequently a symptom of the uneven power balance between small businesses and their much larger clients. The clients know how dependent small businesses are on those contracts and they know they can get away with withholding payments.
The Conservative Party has additionally followed ISPE’s recommendation to establish a Small Business Conciliation Service to help resolve instances of dispute. The Service would help to mediate instances of unfair treatment in the supply chain, including late payment, before they evolve into issues that seriously impact upon micro-businesses.
Chamberlain continued: “A business conciliation service, like the model used in Australia, would mean the smallest businesses would have the tools to challenge unfair behaviour by their clients, without the need to resort to expensive court action.”