Many SMEs are still suf­fer­ing from late cus­tomer pay­ments

Yorkshire Post - Business - - FOCUS ON SMES -

SMALL BUSI­NESSES con­tinue to suf­fer from late pay­ments from cus­tomers in large num­bers, ac­cord­ing to new re­search from Close Broth­ers In­voice Fi­nance.

While the num­ber of firms ex­pe­ri­enc­ing sig­nif­i­cant prob­lems has fallen over the past three years, al­most a quar­ter are still suf­fer­ing at the hands of cus­tomers who do not pay their bills on time.

The lat­est quar­terly Close Broth­ers In­voice Busi­ness Barom­e­ter shows that 24.2 per cent of SMEs now re­gard late pay­ments as a prob­lem for their busi­ness.

While that is down from 33.2 per cent in March 2015, it means one in four SMEs are still strug­gling to cope, de­spite a se­ries of gov­ern­ment ini­tia­tives de­signed to get on top of the prob­lem. Close Broth­ers’ re­search also sug­gests that the size of the late pay­ments is­sue is in­creas­ing for many SMEs.

The barom­e­ter found that 25.2 per cent of busi­nesses suf­fer­ing re­ported that they were owed more than £40,000, al­most twice as many as the 13.2 per cent of SMEs suf­fer­ing to this ex­tent in March 2015.

David Thom­son, CEO of Close Broth­ers In­voice Fi­nance, said: “Our re­search sug­gests that de­spite a se­ries of ef­forts to com­bat the mat­ter led by gov­ern­ment and other or­gan­i­sa­tions, too many SMEs still aren’t be­ing paid on time.

“This is an is­sue caus­ing real hard­ship for many firms and has neg­a­tive im­pli­ca­tions for the per­for­mance of the econ­omy as a whole.”

The re­search also sug­gests that in­voice fi­nance con­tin­ues to play a key role in help­ing SMEs un­lock the value tied up in in­voices is­sued to cus­tomers – but that more work needs to be done to prove the case for it.

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