LONDON, Sept 6 (Reuters) - British retailer Marks & Spencer said it was extending the time it takes to pay itsgeneral merchandise suppliers, seeking to keep a lid on costs asit attempts to turn around the fortunes of its clothingbusiness.
The nation's biggest clothing retailer has reported eightstraight quarters of declining underlying sales in its generalmerchandise division, consisting of clothing, footwear andhomewares, and has pinned its hopes for a revival on newautumn/winter ranges which hit stores in July.
A spokeswoman for M&S said on Friday its 500 generalmerchandise suppliers, around 50 of which are based in Britain,had been informed of the payment changes.
Freight-on-board (FOB) suppliers have seen their paymentterms extended from 60 days to 75 days, whilefull-service-vendors (FSV), who transport, store and delivergoods for M&S, will see their payment delayed from five weeks toseven weeks.
The changes, which will boost Marks & Spencer's cash flow,could anger suppliers.
M&S's major suppliers were upset in October 2011 when thefirm asked them to make a one-off contribution of 1.25 percentof their annual turnover with the retailer to its store revampprogramme and associated advertising.
"Like any company, we are always looking at ways to ensurewe are running our business efficiently and that it is well setup for the future. As part of this, we are extending our GMsupplier payment terms to bring us in line with industrystandards," said the M&S spokeswoman.
Shares in M&S, which have risen 35 percent over the lastyear, hit an over five-year high on Thursday on hopes the newranges will deliver, as well as an improving economic outlookfor the UK.
The stock was up 1.2 percent at 501 pence at 12.39 GMT,valuing the business at about 7.8 billion pounds ($12.2billion).