THIS NEWS FOUND AT: PDNPulse
GM (through its ad agencies) has asked photographers to officially accept or reject a set of new payment terms. The new terms say GM will "typically" pay ad agencies within 60 to 75 days of an invoice, who will then pay the photographer (or "vendor"):
"VENDOR UNDERSTANDS THAT IT WILL BE
PAID ON A SEQUENTIAL LIABILITY BASIS (AGENCY SHALL PAY VENDOR ONCE PAID
BY GENERAL MOTORS) PURSUANT TO GENERAL MOTORS' STANDARD PAYMENT TERMS
AND THAT GENERAL MOTORS WILL TYPICALLY PAY AGENCY WITHIN 60-75 DAYS,
PROVIDED VENDOR HAS SUBMITTED A PROPER INVOICE."
The photographer who provided these details (on condition of anonymity) says some GM photos shoots pay 0,000 to 0,000, so the lack of an advance and a two-and-a-half month delay of payment is a big deal.
There's also some uncertainty over whether General Motors will still be able to pay its bills 75 days from now. GM has borrowed billion of dollars from the government, saying it needs the money to stay out of bankruptcy. (GM said this week it has managed to cut costs and won't need an additional billion it had requested.)
Last month, a story in The Wall Street Journal said there were similar changes in store for GM's television ad producers. The Journal reported:
production costs 60 days after the first day of shooting and the
remaining 50% when the ad is finished. That's a major departure from
the standard practice of paying 50% or 75% of the cost before
production starts."
General Motors is America's second-biggest advertiser after Procter & Gamble. It cut its ad spending by 15 percent in 2008, according to a recent Nielsen report.
(Vintage Buick ad via Flickr.)
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