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White House Expands SupplierPay Initiative to Strengthen Small Businesses
In July, the White House launched the SupplierPay initiative, which is a partnership with the private sector aimed at supporting the health and vitality of small businesses by increasing their working capital.
There were initially twenty-six companies involved, but an additional twenty-one have now joined the party.
The first companies to sign up were: Apple, AT&T, Authentix, Cardinal Health, Coca-Cola, CVS, Ericsson, FedEx, Honda, IBM, Intuit, Johnson & Johnson, Kelly Services, Lockheed Martin, Milliken, Molina Healthcare, Nissan, PG&E, Philips, Rolls Royce, Rothschild North America, Salesforce, Textura, Toyota, Walgreens, and Westinghouse Electric Company.
The new companies include: Akima, Chenega Corporation, Chugach Alaska, Cook Inlet Region, Inc., ConAgra Foods, Inc., Dominion Resources Inc., Dun & Bradstreet Credibility Corp., Intel Corp., Hallmark Cards, Inc., Kaiser Permanente, McGraw Hill Financial, Inc., Nova Corp., Inc., Oracle Corp., Sacramento Municipal Utility District, Sealaska, Siemens Corp., Sempra Energy, Southern California Edison Co., 3M Co., Xerox Corp., and Zappos.com, Inc.
To save you the simple math, that's a total of forty-seven companies now participating. These companies have pledged to pay their small suppliers faster or enable a financing solution that helps them access working capital at a lower cost.
"The SupplierPay initiative helps address the difficulties small businesses face in accessing affordable working capital," the White House said in a statement. "Reducing the time it takes for smaller suppliers to get paid or lowering their short-term borrowing costs enables them to devote more of their resources to investing in their business, hiring, and growing."
The initiative builds on the Federal government's QuickPay initiative, which the President launched back in 2011 and renewed in July.
The Commerce department released a report finding that the larger companies participating in the SupplierPay initiative also have the potential to realize "significant economic benefits".
"High working capital costs for small suppliers can get passed onto large customers in the form of lower-quality goods and services, less stable suppliers, and higher prices," the White House said. "Reducing working capital costs—as SupplierPay companies are doing—unlocks capital to be put to work for the benefit of large buyers, and for the entire economy, according to the report."
The White House held a SupplierPay working session hosted by National Economic Council Director Jeff Zients and SBA Administrator Maria Contreras-Sweet. The companies discussed the actions they're taking to implement their respective SupplierPay pledges.
As an example of what companies are doing, Intuit surveyed its supplier base and offered 10-day payment terms to 320 small businesses. It also moved its independent contractors to contracts that committed to pay them within 10 days.
Lockheed Martin is sourcing over 60 percent of its work through its supply chain, which includes over 15,000 companies.
According to the White House, over a quarter of small business owners are planning capital investments.