Late payment remains a huge issue for small businesses as they continue to struggle in an uncertain economy. Whilst small businesses are still feeling the pinch, they appear to be adopting a back to basics approach to credit control in a bid to ease the pressures of late payment.
Commenting, Gerald Irwin of Sutton Coldfield based Licensed Insolvency Practitioners and Business Advisers, Irwin Insolvency said, “As a direct result of this back to basics approach, the payment performance has improved with businesses waiting an average of seventeen days beyond agreed credit terms, five days sooner than in the preceding six months. However, despite the evidence that some businesses are tackling payment issues head on, there still remain a number of extremely worrying trends.”
However, the whole issue of late payment is still vigorously debated and it is no secret how much it has affected the financial health of UK businesses. It is encouraging to see that the majority are employing a range of different credit management strategies in order to clamp down on late paying customers. “It certainly appears that businesses are taking a step in the right direction by utilising a number of options at their disposal with increased numbers outsourcing their credit control functions which can be a advantageous as specialist debt collection agencies will take on the overall responsibility of chasing customers for payment,” added Mr. Irwin.
While late payment remains a significant issue, businesses should do all they can to stay on top of credit management and safeguard their cash flows.