Small firms 'more vulnerable to effects of late payment'
Commercial insurance
16th June 2009
Small businesses in Britain are more likely than their larger counterparts to suffer from the effects of late payments, it has been claimed.
According to a spokesperson from the British Chambers of Commerce, smaller enterprises do not have the levels of cash flow of bigger companies and are therefore "more vulnerable" to problems with it.
He added that the collection departments of local councils and authorities are "one of the biggest problems when it comes to late payments", adding that "there is a lot of work to be done" to improve the current situation.
His comments follow the publication of a study by Barclays Local Business, which suggested that small and medium-sized enterprises (SMEs) in the UK are owed over £10 billion at any one time, £1.7 billion higher than last year.
The annual Late Payments report highlighted the scale of the problem of customers failing to pay on time and indicated that SMEs have lost almost £793 million as a result of non-payment over the past 12 months, an average of £1,552 each.
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