Your company is most likely one of about 80percent of UK’s businesses whose clients expect merchandise or services to be provided online credit. By this I suggest that your clients are most likely to cover your products after shipping, state, 30 days following bill date.
Unless you’re in the retail industry, among the dangers you face is that the chance of late or non-payment by customers. Our late Payment Tracker affirms that late payment is still a substantial business issue even following some current minor improvements.
Data in the UK Government’s Annual Small Business Surveys (ASBS) as 2003 and Small & Medium Enterprise (SME) Business Monitors in December 2008 into September 2009 had been examined to form our late Payment Tracker. It indicates that some 26percent of SME companies still respect late payment because a’Big Problem’.
There is a wide correlation between the prevalence of late payment along with the accelerated growth in business liquidations observed as Q1 08 as mentioned from the UK Government’s Insolvency Service.
This connection is directly supported by the EU Commission for Enterprise & Industry which claims that one in four of insolvencies is because of late or non refundable. Additionally, 56percent of SME’s with workers respect late payment among the top main causes of cash flow problems (Sep 09 SME Business Monitor).
It is apparent that non or late payment of your bills by both individual and commercial debtors may have a significant detrimental impact on the fiscal health and survivability of your company. Anecdotally, owners of many mature companies tell me that the times of conducting business on a handshake are quickly disappearing.
Happily a significant business issue comes with an equally powerful and comparatively inexpensive solution. It begins with producing conditions and terms to your company written from a credit score management standpoint. Properly drafted, your company terms and related customer documentation can help ensure your invoices become handled with priority from your clients.