A report out yesterday claimed that late payments are a huge issue for the majority of small and medium businesses in Northern Ireland. This has become a bigger problem with customers paying late during the pandemic, which probably isn`t surprising but it certainly does not make life any easier for firms.
94% Waiting On Late Payments
The report, commissioned by Barclays, found that medium sized firms (classed as having between 50 and 249 staff) were the hardest hit with a massive 94% saying they were waiting on late payments. This leads to businesses being unable to take extra staff on, invest in the growth of the company and in the worst case scenarios forcing them to fold.
In an article in the Belfast Telegraph yesterday, Hannah Bernard, head of business banking at Barclays, is quoted as saying:
“Late payments is the single biggest cause of business failure.
“We want to unite the small business community in tackling this issue and raise the social conscience of larger businesses who don’t pay on time.
“Any business worried about the impact of late payments should contact their bank to talk about their options, whether that be for guidance on how to report a business for paying late, or to explore invoice finance and insurance options.
“Business owners across the UK have a lot of challenges to juggle right now, and the stress of chasing late payments shouldn’t be one of them.”
Uncertainty Has A Crippling Effect On Businesses
Liz Barclay, the Small Business Commissioner, is also quoted in the article, saying:
“Repeated delays and excuses, and extended payment terms of 90/120 and even 360 days are common. Uncertainty kills small and micro businesses as well as freelancers and sole traders,”
The report also found that the problem of late payments was having an effect on a lot of business owners mental health, with over a third saying that they had problems sleeping at night due to the stress this engendered.
If you have a business who is suffering from customers who are constantly paying you late it may be time for you to get some outside help. Here at WHR Accountants we can take this onboard and manage your cash flow situation so that all you need to worry about is production and sales. If you require a friendly chat about this issue please give our team a call at the earliest opportunity on 028 3752 2909.