Accessory manufacturers and other suppliers that deliver products for Apple outlets have to wait longer before being paid by the company, a source says, with changes in terms also making them accountable for unsold products.
It is reported that Apple has made changes to the way it handles products it receives from suppliers for sale in the online and corporate Apple Store. Suppliers who do not agree with the new terms are reportedly at risk of being placed on Apple’s shelves, with the changes largely to Apple’s advantage.
After issuing a circulation for the retail stores to a new supplier, The Telegraph reports Apple has made applications to suppliers directly, and in a flexible way. Suppliers told the report that terms had previously been negotiated with distribution companies, but the new ones were set by Apple and are not negotiable.
The changes include a change in the length of time a provider waits for payment, increasing the period from 45 days to 60. Providers must also adopt a “charging model,” as this will not pay them only once something is sold.
The non-negotiable nature of the changes at least means that all suppliers have the same contract as Apple, but the reliance on sales through Apple also means that most tend to accept them. Retailers are also expected to expect to tighten cash flow from the changes.
“They’re not doing any favors to their vendors,” said one anonymous supplier. “Their vendors have financial challenges that they won’t. I don’t think anyone is going to turn them down. There’s very little competition for the brand show you get. by Apple. It’s definitely a pressure. ”
An Apple spokesperson said “We greatly value our close relationship with the world’s top companies that sell their products through Apple.com and in our stores. Apple regularly evaluates the combination of third-party products we sell and the structure of our models to enable vendors to grow their business reliably and confidently. ”
The switch to suppliers is not the only way Apple is trying to improve sales position. In August 2020, he applied to UK landlords to halve the amount of rent he pays or to receive free rental periods, in exchange for rent extensions.