Late Payment Culture

Late payment has hindered businesses for as long as can be remembered, with large organisations often the worst culprits.

Companies invoice for their work and should expect payment according to the terms quoted; every day payment is not received erodes the suppliers margin and every day that passes also heightens the concern that payment may not be received at all.

Late payment and the impact it has on cash has historically been one of the principal causes of business failure.

Many large businesses use the shabby tactic of delaying payment in the full knowledge they are potentially causing serious problems to suppliers; its almost a machismo trait that is not at all edifying and is, in effect, nothing more than a sharp practice of which those that use the tactic ought to be ashamed.

Technology means there really is no excuse for not adhering to terms, in previous times businesses could use tired stories of cheques in post, payment runs, signatory needed and so on with none of these applicable any more.

Covid-19 offers a new excuse to those habitual late payers; a recent survey by Bibby Financial Services suggests over half of UK SME’s are being paid later as a result of the pandemic.

Whilst the pandemic has brought understandable cash flow issues there remain, cash generative and cash rich businesses who are abusing their position to squeeze suppliers even further.

Familiar with the issues brought about by late payment, we can and do help businesses, both with appropriate cash flow advice and with assistance, if needed, with collection work.

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