WASHINGTON – Leaders of Pittsburgh-based Westinghouse Electric Co. and 25 other corporations who gathered at the White House Friday have committed to pay their small-business contractors faster under a new Obama initiative.
Dubbed SupplierPay, President Barack Obama’s plan is a voluntary program meant to boost the economy and strengthen private-sector supply chains. When contractors are paid sooner they can more easily invest in expansions, equipment, hiring and training, the White House said.
SupplierPay is modeled after QuickPay, a federal program that requires federal agencies to pay small-business contractors within 15 days. QuickPay began in 2012 and, according to the White House, helped 172,000 small businesses free up capital to invest and hire new workers.
Westinghouse already prioritizes payments to smaller contractors because it wants to help them succeed, President and CEO Daniel Roderick said after Friday’s roundtable with the president, top White House advisers and other business leaders.
“Doing that helps them grow and become long-term suppliers for us,” Mr. Roderick said. “Overall it’s just a fundamental corporate responsibility to develop small companies that hopefully grow into big companies. If you look way back to the roots of Westinghouse, it was a small business, too.”
Mr. Roderick is proud of his company’s payment turnaround for bills from small contractors – usually in less than 15 days -- but says the company plans to do even better.
One obstacle is late payments from its own customers overseas, where Westinghouse does about 60 percent of its business, Mr. Roderick said.
“If our customers start paying us later and later then we can’t support the small-business infrastructure to pay them earlier,” he said.
He’s looking to the federal government to strengthen import-export banks, which finance and insure export purchases.
Mr. Obama seemed receptive to that during Friday’s meeting, Mr. Roderick said.
“The president is trying to look to see if there’s anything more the government can do” to get more corporations to reduce payment turnaround time, Mr. Roderick said. “I think he was in listening mode. He was trying to understand what more he could do and he wanted to hear what the motivation is for the larger businesses to participate.”
Washington Bureau Chief Tracie Mauriello: email@example.com, 703-996-9292 or on Twitter @pgPoliTweets.