Small company bosses urged to chase payment
Mon, 12 Oct 2009
Small business owners seeking to avoid running in to difficulties as the recession ensues should seek payment from customers and clients as soon as possible, it has been claimed.
Phil McCabe, spokesperson for Forum of Private Business (FPB), highlighted the fact that more instances of late payment tend to arise during economic downturns.
In addition, more companies seek to alter contractual terms or conditions, causing businesses to wait for invoices to be settled, he stated.
Mr McCabe commented: "The main issue that is causing our members concern, [is] if you can't borrow money to the same degree, can't get access to credit to the same degree, it's all the more important that you get paid on time."
He added that the most important thing in any business is maintaining a healthy cash flow, and the easiest way to achieve this is to ensure timely payment.
FPB chief executive Phil Orford recently claimed that small firms' cash flow is being "decimated" by credit restrictions and declining trade.
He added: "Our research suggests that poor payment, which has always been a problem, is now threatening the very survival of many businesses."
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