ATA to investigate lengthy payment terms afflicting trucking operators

Photography by: Brad Gardner


Organisations express concern over contracts that allow payment terms of up to 120 days.

ATA to investigate lengthy payment terms afflicting trucking operators
ATA CEO Chris Melham says small trucking companies are waiting up to 120 days for payment due to the market power of large clients.

 

The Australian Trucking Association (ATA) will conduct an investigation into the extent and consequences of extended terms of payments for transport operators.

The ATA council has resolved to be proactive on the issue.

State-based member organisations expressed unanimous concerns about freight customers reportedly extending their payment terms to up to 120 days after a transport service is completed. 

ATA CEO Chris Melham says extended terms place significant financial pressure on road transport operators, who need to pay their own suppliers and staff, including drivers, in a far shorter window of time.

That pressure can cascade down from cash flow problems into road safety concerns.

 

Are you being forced to accept lengthy payment terms?

Posted by Owner Driver on Thursday, 1 October 2015

 

"Trucking operators work on small margins, and most are small businesses," Melham says.

"As price-takers, they are being forced to accept terms of up to 120 days due to the market power of large clients.

"It is important that customers, like large retailers, ensure their payment terms and price demands on the trucking industry are not forcing small businesses and owner drivers to cut corners, resulting in unsafe and illegal business practices."

Payment terms have been a hot-button issue in transport circles in recent months, with two country-based senators first raising the potential for a Senate Inquiry in August.

Labor senator for Western Australia Glenn Sterle and Nationals senator for New South Wales John Williams say they are considering options to force more timely payments to transport companies.

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