Sir Philip Green’s Bhs is tightening the screws on its suppliers by moving its discount rate into line with that of Arcadia Group into which it is merging.

Many suppliers are angry at the change of 3 per cent in discount rate, moving it from 11.25 per cent to 14.25 per cent effective on payments due from July 1.

In a letter seen by Retail Week, Bhs finance director Barbara Gentles said the move was part of the merger with Arcadia. She said: “As part of this process, we are harmonising group supplier discount rates.”

One supplier criticised the timing of the move.

“This wouldn’t be an issue to anyone given enough time but they’re bringing this in with only six weeks notice and just after all the price negotiations for the Autumn/ Winter ranges and products have been negotiated,” the supplier said.

The supplier added: “The supply base is understandably up in arms. Had this announcement been made several weeks ago before prices were finalised the three per cent would have been built in.”

No comment was available from Arcadia Group.