Getting onto a larger company's vendor list
What vendor registration usually involves, the documents to keep ready, how to read payment terms, and what MSME payment provisions say, with a reminder to check the current rules.
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A large company can be a valuable customer, but it does not buy the way a shop does. Before the first rupee arrives, you may have to be approved as a vendor, receive a purchase order, deliver, have the delivery accepted, and wait for an invoice to pass through a payment cycle you did not set.
This guide describes how that process commonly works, what to prepare and what to ask, and what the Indian rules on payment to micro and small suppliers say. Buyers differ, and rules change, so treat it as a starting point and check the details with the buyer and with a chartered accountant or lawyer.
What you should come away with
- Ask the buyer how their vendor registration works instead of assuming
- Keep a document folder ready and make every document match
- Do not start work without a purchase order
- Read the payment terms, and what the days are counted from, before you agree
- The MSMED Act sets payment time limits for micro and small suppliers; check how it applies to you
- Plan your cash for the gap between delivery and payment
Start by finding out who inside the buyer handles vendors. In a larger company the person who wants your product is usually not the person who registers you or pays you. The requirement may sit with a purchase team, with finance, or with a compliance function. A short, honest introduction from a user inside the company helps, but the actual registration is usually a process with forms and checks. Ask early: what is your vendor registration process, what do you need from us, and how long does it usually take? Do not assume that a friendly meeting means you are registered.
The documents asked for vary, but a typical list includes your business and PAN details, proof of address, GST registration where it applies, bank details with a cancelled cheque or a letter from the bank, and a signed vendor form. Many buyers also ask for a company profile, references, certifications relevant to your work, and sometimes a confidentiality undertaking or a code of conduct. If you have a Udyam registration, they may ask for the certificate. Some buyers ask for much more. Treat any list you find online as indicative and use the buyer's own form.
The most common cause of delay is mismatch. The name on your PAN differs from the name on your bank account. The address on the GST certificate differs from the one on the vendor form. The spelling of the business name changes from one document to the next. A finance team that has to verify details against official records will stop at the first difference. Before you apply, put every document side by side and make the names, addresses and numbers consistent. Keep one folder, in a form you can send within the hour, and keep a note of what you sent and when.
Then comes the purchase order. In many organisations the purchase order is the authority to supply and to be paid, and an invoice without one is likely to be stuck. Do not begin work on a verbal assurance. When the order arrives, check that the description, quantity, price, delivery date and payment terms match what you agreed. Quote the order number on every delivery note and invoice. Ask who signs the proof of delivery or acceptance, because in many companies the payment clock starts only when that is done.
The next thing to read is the payment terms, and the sentence that matters most is what the days are counted from. Thirty days from the invoice date is very different from thirty days from the date the invoice is approved, or from the end of the month in which it is received. Find out whether the buyer pays on fixed dates, weekly or monthly, and what the cut-off for each run is. An invoice that misses a cut-off by a day may wait weeks. Ask about advance or staged payments for long jobs, and about retention, where part of the amount is held back for a period.
Indian law gives some protection to micro and small suppliers. Under the Micro, Small and Medium Enterprises Development Act, 2006, a buyer must pay within the period agreed in writing, which cannot exceed 45 days from the day of acceptance or deemed acceptance of the goods or services; where there is no written agreement, the period is 15 days. Late payment attracts compound interest with monthly rests at three times the bank rate notified by the Reserve Bank of India, and disputes can be taken to the state's Micro and Small Enterprises Facilitation Council, including through the MSME Samadhaan portal. In addition, section 43B(h) of the Income-tax Act, 1961 allows a buyer to deduct amounts owed to micro and small suppliers only when actually paid, if they are paid after those time limits. According to a Finance Ministry reply in the Rajya Sabha on 21 July 2026, the same rule now appears in the Income-tax Act, 2025 as section 37(2)(g).
The details matter. The provisions apply to micro and small enterprises, not medium ones. Commentators say the supplier must be registered on Udyam at the time of supply, not afterwards. Retail and wholesale traders were allowed to register on Udyam from 2021, but reports say the benefit was limited to priority sector lending, so a trading business should ask its accountant whether the payment provisions apply. None of this makes a buyer pay faster on its own. Many suppliers hesitate to invoke interest against a customer they want to keep, and the rule is easiest to rely on when your agreement and invoices are clear.
Some buyers also use TReDS, an RBI-regulated electronic platform on which a supplier can have an accepted invoice financed by banks and other financiers at a discount. Whether it is available and worthwhile depends on the buyer, the cost and your own eligibility, so ask your bank and the buyer rather than assuming.
Finally, plan the cash. Work out what you must spend before you are paid: materials, wages, transport, taxes on your invoice. Ask what happens to your business if payment is a month late. Be careful about letting one buyer become most of your revenue. A large order that you cannot fund can hurt more than a small one you can.