Bud Light and Cadbury Makers, Coca-Cola Bottler Hit for Lengthy Payment Delays

Some of the world’s biggest retail brands have been shamed for taking months to pay smaller suppliers. Bud Light maker AB InBev and the bottling company behind Coca-Cola are taking well over 100 days to pay back their suppliers, according to the latest report on invoice payments by Good Business Pays.

The think tank behind the study warns that slow repayments, which AB InBev insists only affect its larger suppliers, are likely majorly impacting small businesses living hand-to-mouth and reliant on cash from multibillion-dollar companies.

The Ripple Effect on Small Businesses

Fortune reported that Belgian multinational brewing giant AB InBev was one of the biggest culprits of slow payments, taking an average of 117 days to pay back its suppliers.

Nearly four out of every five invoices received by the drinks maker weren’t paid for more than 60 days.

Coca-Cola Europacific Partners, the European bottler of Coca-Cola’s drinks, took an average of 107 days to pay back its suppliers, while Cadbury-owner Mondelez took 99 days to pay invoices.

Reckitt, the manufacturer of cleaning products for kitchens and bathrooms, including Air Wick and Finish, was the worst offender, with an average payment period to suppliers of 126 days.

According to Yahoo, The repercussions of such delayed payments extend far beyond mere financial inconvenience, potentially stifling the growth of smaller enterprises. In a market where cash flow is king, these delays can lead to a domino effect, forcing small suppliers to delay their payments to creditors, reduce inventory, or even cut down on essential investments required for expansion or innovation.

This challenging landscape underscores the need for larger corporations to adopt more responsible payment practices, not only as a matter of financial ethics but also to foster a healthy, sustainable business ecosystem that benefits all parties involved.

Initiatives for Promoting Timely Payments

To address these challenges, advocacy groups and think tanks like Good Business Pays call for regulatory intervention to enforce stricter payment terms and penalties for delays. They argue that legislation mandating a maximum payment term could drastically change the landscape, ensuring that small suppliers receive their dues in a timely manner.

Additionally, implementing transparent payment reporting could hold large corporations accountable and encourage them to improve their payment practices. However, beyond legislative measures, there is a growing call for a shift in corporate culture towards greater transparency and equity in business transactions. This entails not just adhering to the law but embedding prompt payment practices into a company's very ethos.

Photo: Bud Light Newsroom