Coping with late payment, the top concern for small business
According to research from the Federation of Small Business (FSB), the time spent chasing late payment, and the effects of dealing with bad debt, are costing UK small and medium sized businesses an estimated 286 million man hours and nearly £3.6bn per year.
So it’s not surprising that a recent study by the Institute of Directors highlighted late payment as the greatest concern for small businesses, ahead of lack of finance and business rates.
There is legislation to protect businesses against late payment. This is the Late Payment of Commercial Debts (Interest) Act 1998. It enables businesses to charge other businesses interest on their debts, and recover costs of up to o£100 depending upon the size of the debt.
There is a fine balance between maintaining good business relationships and credit control. If debts are not paid promptly then in our experience a solicitor’s letter often leads to payment. If payment is still not made after a solicitor’s letter then the issue of court proceedings is inexpensive and many debtors pay the debt to avoid a county court judgment.
Contact Peter Kirk on 01202 446 514 to see how we may be able to help you recover money owed to you.
