Larger firms slower to pay debts to SMEs

According to Experian, large firms in Britain are the slowest to pay their debts, though there has been some overall improvement in 2011.

The statistics show that British companies often pay their suppliers up to 26 days later than the period agreed in the terms and conditions. However, larger firms, with more than 500 employees were found to be paying their suppliers as much as 34 days later than the agreed deadline for payment.

Head of payment performance at Experian UK & Ireland, Jason Mills said:

"Payment performance is the timeliest indicator of the current health of any business, so the overall improvement suggests that during the last three months of 2011, pressure on cash flow and finances was more manageable for most businesses."

Lynette French of the Debt recovery team in Wilson Nesbitt solicitors commented:

"Small to medium sized companies are quickest to feel the squeeze when their customers do not pay in a timely fashion, and a delay of 3 to 5 weeks can have a significant impact on their cash flow.

"We regularly tell our clients to make sure they advise their customers of their terms and conditions in respect of bill payment clearly before agreeing any transaction, and not to be slow to enforce their policy if their customer is not forthcoming with payment within the prescribed period. SMEs rely on prompt payment now more than ever, and unfortunately, involving a solicitor debt recovery service is sometimes required to ensure payment of a debt is received.

"Small businesses should never be put in a position by larger companies of having to chase invoice payments, but once that scenario arises, it is imperative that SMEs take a proactive approach to debt recovery, and sometimes just an initial letter from a solicitor can be enough to secure payment."

If you your company is owed money by customers in Northern Ireland, and you would like to receive information about the debt recovery service offered by Wilson Nesbitt in Belfast, you can call a member of the team by calling 0800 840 9291.

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