Furniture and fashion retailer Laura Ashley has been accused of squeezing its suppliers by support group the Forum of Private Business.
It emerged that the retailer sent a letter out to suppliers two weeks ago asking for an “immediate cost price reduction of 10%”, including on orders already placed.
The letter said that retail prices were “continually being driven down” by increased promotional activity and the growth of online-only retailers. It said the reduction would save it from reviewing its supply base.
The FPB said it was a “lazy and destructive” way of doing business. It said the requested reduction was a “huge amount”, according to the BBC.
“In fact, it probably means in many cases the supplier is making no profit or even operating at a loss,” the Forum said.
Laura Ashley insisted it had “very strong and long-term relationships” with its suppliers.
It added: “We work closely with them to deliver the right products at the right prices for our customers, and are having ongoing positive conversations with all our suppliers to ensure we keep doing this.”
Laura Ashley is the latest retailer to be criticised for putting pressure on its suppliers. Earlier this month, department store John Lewis was accused of being “greedy” by the FPB for asking for a rebate from suppliers that experience a sales increase through its stores.