UK: Boohoo Group extends payment terms for suppliers globally
"Boohoo extends supplier payment terms", 7 January 2025
Boohoo Group has extended its payment terms for suppliers, effective this month.
UK, Morocco, and Turkey-based manufacturers will now receive payments within 45 days, up from 30 days, while international suppliers will wait 90 days instead of the previous 75. These changes are set to take effect later this month, Drapers reported.
UK-based importers will continue to be paid within 60 days, alongside a select group of suppliers who are exempt from the new terms.
One supplier told Drapers: “This will impact our business, especially as it’s difficult to get credit insurance on Boohoo at the moment.”
In September 2023, The Sunday Times revealed Allianz Trade slashed cover by an average of 50% for Boohoo, with some suppliers to the fast fashion retailer having their coverage level cut to zero.
Another supplier told Drapers: “It will affect our cashflow, but I hope it works out in the long term [if it can help Boohoo improve its financial position].” He added that payment terms are now longer “across the board”, compared with three years ago.
Boohoo had previously extended its payment terms in December 2022, from 30 to 60 days for UK-based suppliers and from 14 to 30 days for UK manufacturers.
A spokesperson for Boohoo told the outlet: “We regularly review our ways of working to ensure we are operating as effectively and efficiently as possible.
“Boohoo Group’s payment terms are highly competitive and have been updated in line with the wider industry standard.”
The move comes as the fashion giant attempts to strengthen its balance sheet under the leadership of new CEO Dan Finley...