Business Advice Finance
Sooner, not later T
he value of late payments in this sector reached £16.6bn in 2011, compared to £7.9bn in 2010. Retail and distribution
firms are dealing with the highest value in late payments compared to £10.3bn owed to manufacturing firms and £5.9bn outstanding in the service sector. The average amount owing to firms in late payments in 2011 was £82,000 – more than double 2010’s figure of £39,000 – and is also the average amount owed to SMEs nationally in 2011.
WORRIED & ANXIOUS
Almost half (42%) of the businesses sur- veyed in the sector experience Late pay- ments, and more than a quarter (26%) admit to being worried and anxious about the consequences of not getting paid. And while the majority of businesses in retail and distribution (43%) expect to have their
44 May 2012 Storage Handling Distribution
invoices settled within 30 days, on average they have to wait another 31 days after that – making it two months before being paid. The most frequent excuse businesses in retail and distribution say they hear is that the hold-up is due to internal systems – 60% say they are told the bill is being processed by accounts and 49% are being told their invoice is waiting for authorisation. But the old chestnut of ‘the cheque’s in the post’ is still among the top excuses, with 54% of businesses saying they are given this reason. Mike Hutchinson, head of marketing at Bacs, says the issue of late payments is damaging to businesses which rely on good cash flow to keep going through the fragile post-recession recovery period. He says: “The problem of late payment is clearly getting worse for SMEs in the retail and distribution sector as the value owing is up by more than £8bn on last year’s figures. “Nationally the value of late payments
www.shdlogistics.com www.bacs.co.uk
Businesses in the retail and distribution sector are shouldering the majority of the £33.6bn currently owed to GB SMEs in outstanding late payments. This is according to the latest research by Bacs, the organisation behind Direct Debit and Bacs Direct Credit.
has reached a new high of £33.6bn, and at a time when firms in this sector need to plan ahead for growth to en- sure a strong cash flow, they are hang- ing on for payments which could have a serious impact on their business. “We urge SMEs working in the retail and distribution sector to look at what payments can be automated to help them assert more control over their cash flow, and hopefully alleviate some of that stress on the business and its owner.” Philip King, chief executive of the Institute of Credit Management, adds: “This lat- est research reinforces how important it is that all companies, and more particularly SMEs, agree payment terms upfront and work to cultivate a prompt payment culture in all of their business dealings - one that will benefit everyone concerned.” n
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68