The Staggering Statistics of Late Payments
Very recent statistics released by BACs (the payment company that transfers money and facilitates direct debits) has identified the staggering level of unpaid invoices and late payments suffered by UK businesses.
The BACs Survey
BACs has carried out research identifying that the cost of recovering overdue money is now at an average of £9,000 per year for each small and medium sized business (SMEs).
Some of the other figures identified in the research produced are also very troubling.
43% of SMEs experienced late payments during 2018 and it is estimated that £13 billion is suffered in late payments by SMEs in total.
When payments are late, a large percentage of them are more than 2 months later than the agreed payment terms.
The Impact of Late Payments
The effect of late payment has a knock on effect with other businesses in the supply chain. Over a quarter of small and medium sized business owners who suffer late payments are in turn paying their own suppliers late.
The research also identified that 28% of those business owners suffering late payment had to cut their salaries in order to keep cash within their business and assist with cash flow problems.
It Need Not be That Way
Our courses teach you how to carry out your own debt recovery using the courts, enabling you to can keep control of your unpaid invoices by taking your own steps to recover payment of them, in turn reducing your expenditure on debt collection.
It is crucial to keep on top of cash flow and having clear contract terms is an excellent starting point. Clear terms and conditions can ensure that both you and the customer / client understand when payment will fall due. Terms can also identify the consequences of non payment, such as imposing interest and suspending accounts.
Thereafter, having procedures to monitor and chase up outstanding invoices are important.
Ultimately, if an invoice is unpaid, to force a debtor to pay, you need to obtain a county court judgment and enforce the judgment.
We can help with that process by teaching you how to get from start to finish – from letter of claim, to resolving disputed small claims, to enforcing the judgment.