One of the UK's largest retailers, Marks and Spencer (M&S), is offering its garment suppliers letter of credit (L/C) terms and vendor financing in its efforts to minimise supply chain disruption caused by the coronavirus pandemic.

The London-listed retailer had initially asked all of its suppliers to stop production after the UK government announced a lockdown on 23 March.

Unshipped payments

M&S said it would pay according to its standard terms for products shipped before 24 March.

The retailer said it is also paying for all made garments for the vast majority of orders, which makes up 95 per cent of its product spend and is yet to be shipped by that date according to Retail Week.

Easier trade terms

The clothing, home products and food retailer, which has stores in around 38 jurisdictions worldwide, said it would also cover purchases that have already been made by suppliers of large volumes of fabric.

To provide suppliers with additional liquidity, M&S said it would ease trade terms by dealing with suppliers on L/C terms or by providing vendor financing.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.