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This podcast selection is taken from a series of Business Hub radio shows broadcast on Star FM between February 2011 and October 2014 with advice from basic book-keeping through to crowd funding, directors loans, cashflow and a whole lot more!

There's something for everyone so do feel free to download and share - it might just be the golden nugget of information you need for your business to succeed!Listen at Star 107.9 FM

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Business Trouble - your choices

Don't Let Late Payers Kill You

The Business Hub Show - 17 February 2013

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Mark

Late payers are hitting the headlines again?

Garry

A recent survey by Barclays suggests that more than one in ten small businesses have almost failed as a result of late paying customers – and again it seems it is the big corporates and government bodies that are the issue.
The same survey found that small businesses were owed more than £36bn in late payments. 11% of companies have been waiting for up to six months for accounts to be settled!

Mark

Why do these big corporates take so long to pay?

Garry

The million dollar question!
But it has been reported in the press that Sainsburys have forced non-food suppliers to accept 90 day terms, and O2 have increased suppliers terms from 60 or 90 days to 180 days!  Suppliers of these companies really have little choice but to accept these terms or walk away!

There are many other instances like this, of big corporates bullying smaller suppliers. We have clients who have experienced it.

You then have the big issue of having to comply with their system for your invoices to even get into it and ready for payment!

What they are doing is using their supplier’s money to fund their businesses. When they are retailers too how can this be right?

Mark

What about the Prompt Payment Code?

Garry

This is an interesting one. I cannot see it working. The imposed terms are agreed, so they are paying on time!
There is talk of “naming and shaming” those that do not comply with the code, but they may argue that they are!

Mark

What to do?  How can the smaller business deal with this?

Garry

The simple solution is not to deal with customers that want to impose these crazy terms. Easy to say.

Make sure terms are agreed and discussed up front

Continue to remind customers of the agreed terms

Be efficient and effective with credit control. Proactive. Before the due date.

Funding – Factoring or invoice discounting.

Make a reasoned decision and make sure you can afford it.





 

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