Small business owners spend 10% of their working day chasing payments, according to research by Xero.
London businesses spend the most time chasing payments, up to 1.5 days each month followed by 1.3 days in Wales.
Customers who themselves are waiting for payments and a lack of consistency on payment terms are the main reasons for overdue payments.
- 52% of surveyed business owners are concerned about unpaid invoices
- the worst affected sectors for late payments include HR, IT and manufacturing
- 37% said that late payments effect productivity and cashflow.
Emma Jones, founder of Enterprise Nation, said:
“The late payment epidemic the UK is facing has to change so small business founders don’t spend so many hours chasing doubt and worrying about cashflow on the back of late payment.”
Managing your cashflow
The following steps could help small businesses who are struggling with late payments:
- invoicing – an efficient invoicing process is vital to receive payments sooner rather than later
- keeping records – managing time and material expenses on projects and ensuring that everything is invoiced
- payment terms – outline payment terms and shorten them if needed to encourage your customers to pay sooner
- payment methods – offering easy methods for customers to pay will help late payments.
We can advise on ways to improve your cashflow.