With Industry Experts warning that Business insolvencies are expected to rise in 2018, Firms are being urged to adopt a more pro-active strategy to deal with the scourge of non paying customers.
Dun & Bradstreet recently highlighted the continuing problem and according to their research, 58% of British Businesses are currently at risk of insolvency due to non paying clients.
Leading Business Debt Collection Agency Federal Management recently revealed the most commonly used excuses for non payment as reported to them by their clients.
The most common excuses will come as no surprise to some but others may cause a raised eyebrow.
During their research, Federal Management found that as well as the old lip service excuses given by telephone, ‘lies’ told in face to face meetings were also seemingly increasing which in turn added more frustration to the situation for Businesses.
Top Ten most common excuses for late payment given found in Federal’s survey were:
- The cheque is in the post – The tried and trusted classic
- Didn’t receive invoices – Unlikely! Emails don’t get lost.
- We originally disputed the invoice – On the crease amongst the more unscrupulous
- Account signatory is absent from work – Common excuse
- They’re not available – The person you need to speak to about payment, never seems to be available
- Waiting to be paid myself – Commonly used amongst the sub contracting sector
- No payment run not till the end of the month – Unnacceptable
- Our payment terms are 90 days – Sheer arrogance and irrelevant, it is the suppliers terms that matter
- The invoice has already been paid – Simple smokescreen
- Technical difficulties – Increase in the use of this one as more firms become more reliant on technology
Top UK Business Experts have warned SME’s across the UK that they need to become more pragmatic and proactive when it comes to the problem of non paying clients.
“These surveys shed a light on the continuing problem of late payment in the UK” said a spokesman from Federal Management
“Small Businesses can often be fearful of taking Debt Recovery Action for fear of alienating their customer but our philosophy is that No Business has ever lost a customer simply because they were required to pay what they rightfully owe”