24/09/2010
More than half of British SMEs are not expecting any help from the government, in tackling issues with late payment.
Research from Bacs, the organisations behind Bacs Direct Credit found that 56 per cent of small businesses are handling problems themselves, taking billing and credit control procedures into their own hands.
According to the survey, the number of companies that were feeling the impact of late payments in June had fallen by 20 per cent in a period of six months.
Mike Hutchinson head of marketing at Bacs told Creditman that the recent improvements was down to the efforts of individual companies: "It's extremely heartening to see that there are now many companies making great strides to help themselves beat the late payments cycle, by sharpening up their billing and credit control procedures."
Despite this, there are still around 769,000 companies currently being affected by customers who are having trouble paying, with the total of money owed to them almost a third more (28 per cent) than what was owed six months ago ( 25,000 December 2009 compared with 32,000 in June 2011).
A total of 24.6bn is now owed to businesses across Britain, with many SME's likely to have contacted banks about sales finance to avoid cash flow problems.
"Recovering debt as quickly and as smoothly as possible is one of the key aspects to staying afloat in difficult markets and tight economic times," David Green, chief executive of Positivecollections told New Business.
"This is hugely important for the business community as a whole if we don't want to see this debt culture spiral out of control and have a very real impact on the health of small business and general economic recovery," he added.
Hannah McLaverty-Williamson