Vendor Sues Retailer Over Withholding Payments

As we noted earlier, clothing makers and retailers are tussling over payments, and now the fight is ending up in court. A clothing maker has sued Dillards over $200,000 in deductions that Dillards claims resulted from discounts (meaning that Dillards would owe less money to the maker, according to contractual terms). Part of the issue is that there is no proof of the actual selling price of the merchandise. (Other issues include the deduction of early payment discounts, while still not paying on time.) Hardball business tactics are nothing new, but neither side can afford the infighting. Domestic clothing makers are under incredible pressure from China and other places, especially with the liberalization of textile tariffs, and Dillards is getting squeeze from Target, Wal-Mart, and others. With the money spent on the suit, they would have integrated their systems and figured out how to work better together.