To coincide with a government drive to help business owners get paid on time, the Forum of Private Business is working with Graydon to research small firms’ attitudes to managing invoice payments and cashflow.
According to a recent Graydon UK survey 51% of businesses reported that late payment has become worse during the past year, with 45% believing it could threaten business investments and 20% that it could even threaten their ability to continue trading in 2012.
The latest survey, the results of which will be published in March, asks small business owners what cashflow management methods they believe are most effective – including being able to charge interest on outstanding invoices via the Late Payment of Commercial Debts (Interest) Act 1998, legislation the FPB was instrumental in lobbying for but which is often criticised as under-used.
The survey also asks firms to rate the value of giving customers prompt payment incentives, investing in credit management software and personal contact with their customers’ payroll departments, as well as using invoice finance.
In addition to asking business owners about the frequency and impact of late payment, and changes to payment terms and conditions with no real consultation, the FBP and Graydon UK are asking SMEs to impart reasons why they pay their own suppliers late - and about the benefits of paying on time.
In support of the Government’s prompt payment drive the FPB has produced a new practical Get Paid! guide with the Association of Chartered Certified Accountants, Experian and the Institute of Credit Management (ICM).