August 12 2015
More data has emerged confirming the scale of the challenge that small businesses face in collecting payment for their invoices. Research commissioned by Tungsten, a provider of invoice financing has highlighted how late payment is impacting UK businesses.
The research surveyed 1,000 senior decision makers in small and medium sized businesses (those with less than 250 employees).
23% of those surveyed said that late payment had put the business at risk of closure. The average value of unpaid invoices owed to companies was found to be £40,857. More than half of this value was overdue or past terms, a figure of £20,937 per company.
There has been much focus in recent months on the payment behaviour of larger businesses, with the government announcing a new late payment regulator, and reports about the supply chain bullying by firms like Tesco, Diageo and Inbev. However, the research found that the issue of late payment is not confined to larger companies abusing smaller ones. Only 22% of those surveyed pinned the blame on larger companies not paying their bills. 33% said there was no clear pattern, while 11% and 8% respectively said that medium sized business and the public sector were the worst at paying on time.
Sam white, CEO of My Credit Controllers said:
"My Credit Controllers welcomes the government's focus on getting larger companies to pay their suppliers on time, but this research is a timely reminder that a late payment is just as likely to come from a customer that is a small or medium sized business."
"If you have trouble with customers paying late why not consider credit control as an outsourced service? If it's just a single debt causing you strife, why not submit a commercial debt of any size to our CreditXS debt collection service. You can even add interest and our fee to the debt to be collected so you've got nothing to lose."
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