Meat co-op dilemma
Meat processor Alliance Group's cash-strapped farmer shareholders face a dilemma - either pour more money into the co-operative or risk losing 100% ownership and control.
Shirley accuses Alliance of tactics similar to those of Fonterra -- withholding payment of truckers’ invoices until 90 days have elapsed after the end of the month when the invoice falls due. Fonterra copped a lot of criticism for the practice and backed down.
Shirley says stock truckers are already facing many pressures.
“So the stock transporter has to pay the wages, the fuel [bill], the road user charges, run the business – and doesn’t get paid until 90 days after the invoice is due. That’s totally unacceptable,” he told Rural News.
Shirley says “good on” Fonterra for backing down, but “bad on them” for doing it in the first place.
“My information is that Alliance is still doing this and it’s time they were named and shamed.”
Alliance’s group procurement manager Joost Habing told Rural News that the company altered its payment terms several years ago and had informed its goods and service suppliers about the changes.
“Previously, we had a myriad of payment terms in place and the standardisation was part of a wider programme to improve the efficiency of the co-operative and look after the interests of farmer shareholders.
“We were careful to provide sufficient notice to allow businesses to adjust their own practices. The change did not affect payment terms to farmers for the supply of livestock to the co-operative.”
