‘Take it or leave it’
Bahia Principe demands changes from suppliers; doubles line of credit
Published:Thursday | July 6, 2023 | 12:08 AMMark Titus/Senior Gleaner
SUPPLIERS OF goods and services to Grand Bahia Principe Hotel and Resorts in St Ann are being forced to, among other things, extend their line of credit by an additional 30 days or be removed from the list of dealers supplying the Spanish-owned hotel.
All the policy changes were documented in an email seen by The Gleaner, where suppliers were instructed to fill out an Excel file with their best prices for the period August 1 to December 31, 2023, but were warned that only dealers that agree to a fixed price agreement will be considered.
“Our payment cycle will change to 60 days credit for all suppliers,” stated the email signed by Neotash Pope, purchasing officer at the popular five-star facility. “Only suppliers accepting our credit conditions will be considered to do business with us. If your company is not willing to cooperate and adapt to our payment policy, please communicate it to us so we can end our business relationship from here.
“We need collaboration by quoting the best price possible. Only those suppliers whose quotes are competitive will be considered,” Pope added. “No other chances will be given to review the prices offered, so please ensure that you quote at your best price and a price that you can afford and maintain during the mentioned agreement period.”
But some suppliers are disappointed that they were not consulted, while others believe that a fixed pricing arrangement for six months will expose them to fluctuations in the foreign exchange rate that could affect pricing and credit terms.
60-day credit line ‘far too much’
“In today’s economy to demand a 60-day credit line is far too much when we have to purchase our items for cash or receive just seven or 14 days credit,” said one supplier, who asked that his name and that of his company be withheld.
“For them to extend to 60 days that will put too much pressure on my cash flow and being in a competitive environment it requires that we give a competitive price, which means that my margins will be reduced.”
When contacted Frank Brown, the consultant advisor at the Runaway Bay-based facility, said that hotel management maintains an open-door policy and is satisfied that sufficient notice has been given for negotiation to take place.
“There are some suppliers who would have received an advisory, but the point is that the company is changing its policy arrangement, and having spoken to management,” Brown said, “I can state that the company still has an open-door policy for dialogue.”
Some of the other mandatory policy changes are that invoices not submitted digitally will not be paid, even if hard copies are provided on delivery. Another change involves a new wash station for fruit and vegetable suppliers to pre-wash their produce before weigh-in, while the company’s new sustainability policy will see the use of cardboard eliminated from the hotel’s operation.
“It is an extra burden on the suppliers that after weighing the goods they are asked to go and wash them on behalf of the hotel,” said one longtime supplier. “Once the goods are received and weighed it becomes the hotel’s responsibility, but the thing is ridiculous. But to make matters worse, their take it or leave it approach is not a proper business approach.”