A recent study has shown that UK small and medium size businesses spend more than a week a year chasing late customer payments, worth more than £50bn.
Published figures indicate that the average late payment has gone up to £8,500, and more than a third of UK businesses reported running into cash flow problems.
Late payments also have an impact on a business’s ability to grow as so much time can be spent on managing cashflow problems, taking time and resources away from long-term plans for growth etc.
Accounting software such as Xero, can offer faster ways of receiving payments. Always ensure payment terms are negotiated properly at the beginning of a new contract, to help prevent a pattern of long-term delayed payments. SME’s are also advised to credit check all new clients and take action accordingly to offset any high-risk clients by considering options such as upfront payments, deposits or part payments.
Prioritising timely payments should enable business owners to focus their time and energy on providing good quality products and services, and adding value to their customer’s experience.
If you would like our assistance, please give our Business Services Team a call on either 01788 539000 or 0116 261 0061.