Late payment is costing the UK economy up to £20 billion per year
According to growthcompany, UK businesses are losing £20 billion pounds per year in late payment and in some cases are forcing small businesses into liquidation. “according to a survey conducted by the Credit Management Research Centre. Just over a third of companies responding consider late payment to be the biggest threat to their business.
We do seem to have an ethos in this country that its ok to pay invoices late, there is this strange notion that if you sit on invoices long enough, you may accrue some interest, or some one may forget to chase. Well unless you are a bank then I never understood the reasons for the interest part or waiting to have a court summons land on your desk is probably not a good business move either. Unless there is a real problem, but these problems are one off’s and not habitual.
Perhaps this will be a stark reminder about affiliates whom most are small businesses. There should be not be any occasion for persistent late payment, after all would we delay paying our utility or phone bills?
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Not surprising when some big businesses have turned the line ‘your cheque is in the post’ in to a fine art. Most seem to think it is they who dictate the payment terms and not the vendor.
On the plus side, since the DTI raised this as such a serious issue, government departments have turned from some of the worst payers into some of the best.