Shocking new figures show that 4 out of 5 Small firms in the UK are owed money following a survey by a leading Commercial Insurance website.
The recent Poll conducted by Business insurance website ‘Simply Business‘ has revealed that the vast majority of Small companies are experiencing problems with non paying customers.
The UK’s late payment culture has to change
All sectors are said to be affected and regardless of the size of business, the problem shows no imminent regress as Business leaders brainstorm solutions.
A Company check survey last year revealed that around 68 per cent of small businesses have written off bad debt.
Natalie Glasson who is the Development Manager for the Federation of Small Businesses has serious concerns over the UK’s culture of late payment
She said “The fear among the smallest companies, particular when dealing with larger firms is that complaining about a late payment could result in lost future work which will harm cash flow for their business.
Government taking action
The Government has promised to tackle the problem head on and recently advised that they were looking to recruit a Small Business Commissioner to tackle the problem head on. They will assist in mediating resolutions between small firms and large companies to speed up payment disputes.
It is claimed that Large organisations are the biggest culprits for late payment owing over £26 Billion according to payment processing firm BACS.
Small Businesses need to take action
Insolvency Trade body R3 urged small businesses last year to take action if they are owed money.
The easiest and cost effective measure for Small Businesses is to instruct a Professional Business Debt Collection Agency for a swift resolution.
Chris Spencer of Business Debt Collection experts Federal Management said “No Small Business has ever lost a client by simply asking them to pay”
He continued “We would always urge any Small Business to seek professional assistance where a debtor is evading payment. It is simply unacceptable in this day and age for companies to be giving their suppliers the runaround”
For complex or heavily disputed debts, it is advisable to seek a reputable law firm preferably on a fixed fee basis. A local specialised Legal Professional can be found at the Law Society’s website.
Court action should always be a last report for any small business but there is professional assistance out there and support.