Consumer-products firms squeeze ad agencies

May 30, 2013, 2:41 PM EDT

Large consumer-products multinationals are making their advertising agencies wait longer to be paid, up to six months, the Financial Times reports. Procter & Gamble, Johnson & Johnson and Anheuser-Busch In Bev are among companies that have unilaterally extended their payments terms to 75 days from 45. Mondelez International, is pushing its out to 120 days from July 1, the newspaper says. The changes, which are causing concern in the advertising industry where payroll and freelance labor, which in many U.S. states are mandated by law to be paid within a matter of weeks, are primary costs, are seen as an attempt by the large companies to cut costs through cash-flow management.

YOU MIGHT ALSO LIKE