Late Payments soar to £39.4billion for SMEs
A report from Bacs suggests that late payments equated to £39.4 billion across SMEs in January 2014, a figure that Director of CMG UK Jenny Esau finds shocking in its magnitude. Even more perplexing to Jenny is the extent of this issue in comparison to the simple measures that can be taken towards resolving this issue, stating, ‘SMEs need to have a credit management strategy in place that would drastically reduce late payment and protect profit from bad debt.’
It is the issue of late payments, along with credit risk, that CMG UK work to resolve for companies across the country ; providing a number of services including, outsourcing, training, consultancy, debt recovery and support services.
Simply put CMG UK help businesses throughout the whole of the ‘order to cash process’, helping them to be proactive and customer focused when it comes to collection strategies. As well as ensuring potential customers have the ability to pay their debts on time, thus reducing bad debt risk and improving cash flow.
These services aim to reduce the burden that credit control may pose on a businesses, a burden that has become all the more prominent in light of recent figures that suggest one in four SMEs spend 10 hours a week tackling credit control issues, in lieu of other business responsibilities.
To overlook effect of late payment on SMEs, not only to individual SMEs themselves but for the wider economic climate itself, would be a momentous mistake. Elaine Moore, Chairman of the Federation of Small Businesses for Merseyside, West Cheshire and Wigan states ‘there is recognition at all levels of government that much of the targeted economic growth in the UK will come from small firms and from entrepreneurs setting up and growing businesses’ and therefore indicating that the incredible sum of money tied up in late payments for SMEs could have a detrimental effect on the economic recovery.
So, as business owners you have to ask yourself; are you losing vital hours and money by chasing late payments? And can you justify putting the survival of your business in jeopardy by simply overlooking the importance of effective credit management?
CMG UK can offer guidance and support for your commercial credit management issues and to choose the appropriate avenue for your business to increase profitability. We are approved for several funded initiatives that mean qualifying SMEs can get up to 83% funding towards the costs of our services.
