Small businesses hit by late payments
Some small firms are waiting up to a month longer to be paid by larger companies, a new survey has claimed.
According to the report from Experian, some big companies are delaying payment by as much as four weeks as a way of easing their own cashflow.
The survey found that it is not unknown for some small firms to wait for up to five months from the date of invoicing to have their bills settled.
Although the law allows businesses to charge interest on overdue invoices, many smaller suppliers are reluctant to impose the penalty because of worries that the action may endanger future contracts.
Tony Pullen, managing director of Experian’s business information division, said: “The problem for smaller suppliers is exacerbated because they are often under pressure to settle their own bills quickly to secure goods and supplies essential to their business.”
