Our get-paid-on-time campaign is one of the best ways to support small business, promote competition, and provide a positive jolt to the economy.
Large companies are paying their small business suppliers later and later. Whereas 30 days used to be the norm, large corporations are paying their suppliers and service providers within 60, 90, and 120 days, and often only after significant effort on the part of the small business. In a competitive industry, this wouldn’t be a problem, but in consolidated industries where large companies hold significant market power over their suppliers, large corporations pay late because they can.
With liquidity one of the problems most threatening to small business during the economic downturn, late payment from an important client can lead to layoffs and even bankruptcy for the struggling small business.
We are open to any and all suggestions for how small businesses can weigh in with their clients to receive timely payment within 30 days or to at least reverse the trend of payment from within 120 days to within 30 days.
Currently, we are pushing a very simple proposal:
The Congress via law or the administration via executive order or OMB circular should compel federal contractors to pay their suppliers within the time-frame that the contractor is paid by the federal government. While the government is not always the most punctual payer, we believe this depends on the agency under question.
Ideally, the executive order would make it a priority for agencies to pay contractors within 30 days and would withhold payment until the contractor had a policy of paying its suppliers within 30 days.
This proposal can additionally be pushed at the state level.
Large corporations are widely reported as sitting on $2 trillion in cash, with the priorities for spending that cash going toward paying dividends and acquiring competitors. There is a way to have at least some of that money going more quickly to small businesses who can then pay their workers, add workers, or otherwise expand their businesses—our get-paid-on-time proposal.
By enacting this proposal, the government would:
- Support small business
- Create jobs
- Establish a more competitive, fair payment environment
In short, Congress and the Administration would be acting on our motto—when small business can compete, America wins.Our get-paid-on-time campaign is one of the best ways to support small business, promote competition, and provide a positive jolt to the economy.