The UK's small and medium-sized businesses were owed a record £35.3 billion at the end of 2011 as the critical problem of late payment took yet another turn for the worse.
According to the half-yearly research from Bacs Payment Schemes, the average business is now owed a crippling £45,000 in outstanding payments to compound the cash flow pressures owners are facing at present.
Businesses are now waiting even longer to be paid – a staggering 29.6 days beyond agreed credit terms – meaning many aren't being paid until a full four months after the invoice was raised.
Following last week's news that corporate insolvencies rose for the fifth consecutive quarter during the first quarter of 2011, it's a problem that doesn't look like disappearing soon. However business owners can at least take heart from that fact that the proportion of firms experiencing late payment declined during the second half of 2011.
It's therefore vitally important that business continue to clamp down on late paying customers and ensure that their credit management strategies are as watertight as possible. Credit checking new and existing customers remains an essential part of credit management, as is the need to stay on top of customers from the moment an invoice is raised.
Should an invoice exceed credit terms however, there is a range of commercial debt collection services that are available to businesses of all sizes, including specialist debt recovery and credit control to remove the burden from your business.