As a Co-operative owned by 10,000 farming families, we recognise the enormous contribution small and medium-sized businesses make to New Zealand’s economy and we want to play our part in supporting our country’s economic recovery.
One of the things we’ve been looking at is how we can work with our 3,000 small and medium-sized vendors across the country to accelerate the time it takes to pay their invoices.
That’s why we’re pleased to announce that from 1 July 2020, we will be accelerating payments for small to medium-sized New Zealand businesses (SMEs) so they’re paid within 10 days from the receipt of invoice. Previously we have paid our SMEs on the 20th of the month following the invoice date.
We know that getting paid quickly helps cashflow and keeps businesses running smoothly. This is a small but significant way we can support the country’s economic recovery and demonstrates our commitment to supporting New Zealand’s regional communities.
New Zealand vendors who we spend up to NZD $300,000 per annum with, and that have fewer than 50 employees are eligible for accelerated payments. This represents 86% of all our suppliers, and our goal is to pay 95% of compliant invoices within the ten-day time period.
We’re able to do this as a result of a significant overhaul of our vendor payment system in the last few years which has seen us move all vendors onto electronic invoicing and encouraging them to use a NZ Business Number. This has improved the accuracy of the invoices in our system which enables their invoices to be paid on time.
There are quite a few things that have to be in place to ensure invoices are paid quickly – for example, vendors need to submit correct invoices, we need to check in a timely manner that the invoices match the services which were delivered and sometimes the services delivered or final costs differ from what was originally quoted. We also need to make sure we process and approve the invoices on time too.
We are working with our vendors to provide practical tips on what is required to ensure their invoices are submitted accurately the first time. And we’re impressing on our team the importance of prompt processing of invoices and the flow-on effect this has for our vendors.
I’m proud of the way our farmers and employees have all pulled together to support our communities during COVID-19. Accelerating payments to the 3,000 SMEs we do business with is another way we can do our bit.