More than a quarter of small businesses owed more than £20,000 in late payments
More than a quarter (27 per cent) of small British businesses are owed £20,000 or more in late payments, while a further 58 per cent are chasing unpaid invoices worth up to £10,000, new research has revealed.
According to a survey carried out by financial firm Liberis, small and medium-sized enterprises (SMES) are collectively owed some £14.9 billion in late payments – indicating that recent efforts to clamp down on the issue have had minimal impact so far.
Following the news, the Federation of Small Businesses (FSB) has raised concerns that many SMEs are struggling with so-called “supply chain bullying” – and that this is having a negative impact on their cash flow.
“Many large firms appear to be using the disparity of power in business relationships to squeeze their suppliers, delaying payments to improve their own cash flow,” he said.
“This is supply chain bullying, pure and simple,” he added.
According to Liberis’ study, 50 per cent of SMEs believe that ‘aged debt’ has prevented them from investing in growing their business.
Meanwhile, 72 per cent are concerned that they are currently spending three days a month chasing late payments.