BHP has announced a change to its procurement policies, extending preferred payment terms of 30 days to all Australian businesses in local areas. This change means nearly 300 local businesses in New South Wales will experience preferred payment terms from December 1.
NSW Energy Coal Asset President Elsabe Muller said the decision was made following a period of engagement with suppliers, host communities and the Federal Government.
“We’ve heard concerns about the impact of our standard global payment terms on local businesses, and recognise there is more we can do to support our local communities.
“We will extend our preferential terms further than the existing small and local businesses already captured.” She said.
All of BHP’s suppliers with a primary operating presence in Newcastle, Maitland, Muswellbrook, Singleton, Denman and Scone – regardless of size – will be placed on 30 day payment terms.
Businesses won’t need to apply for the new payment terms, and will be automatically moved to 30 days on 1 December.
BHP Vice President Supply Sundeep Singh says the change will be a huge win in New South Wales.
“As well as being a major employer in regional communities, we are also a major contributor to local economies – through the jobs we provide, and the goods and services we purchase.” Said Mr. Singh
We value the communities we operate in, and want our local suppliers to grow strong businesses as we grow ours.” Ms. Muller added.
BHP’s total direct economic contribution in Australia, including its payments to suppliers, wages and employee benefits, dividends, taxes and royalties in the last financial year was US$33.9 billion.
However Ms. Muller says BHP’s success nationally and internationally is built on strong local relationships.
“We understand that the strength and capability of communities that are local to us are critical to the strength and capability of our business as a whole.”