Wednesday, 22 July 2015

When is the Government going to start listening to SMEs?

Last week we sent out a press release about the growing problem of late payments for SMEs. It's not the first time we have written about this, but it is an absolute shame that we have to keep doing so. It is now over 3 years since we ran our Getting Paid Event, and as a country, we haven't moved forward.

You can read the press release here

What is absolutely amazing is the complete ignorance of successive governments to the plight of SMEs. If you run an SME and provide services or stock to other companies, then you will know all about chasing people for money. Sadly, you will probably know all too well, the issue of a customer going bust owing you money. You know that you will not get that money, and you have to just write it off. The most galling part is that quite often that company that owed you money will be back trading almost instantly, just as a different legal entity. It's a very familiar story.

We feel like we are harping on a little, but we also feel it is a crucial issue the Government need to sit up and take note of. We hear of companies with very real issues through debt, gladly we can quite often help those companies get their money when they want/need it, which of course, Direct Debit can help with.

Back in 2011 Luisa gave us her top 10 tips for getting paid on time. They are all still very valid:

Top ten tips on how to avoid and deal with late payments

1) Carry out a credit check on any new customer
2) Make sure the paper trail is accurate and complete, right from the start
3) Send out a invoice as soon as the work is complete
4) Contact the client a week after the invoice has been sent to ensure it has arrived
5) Send out a statement midway between the invoice date and the due date
6) Make friends with the client’s accounts department
7) Send out a reminder immediately the invoice is overdue
8) Chase regularly
9) Always try to negotiate rather than going down the legal route
10) Make late payments a thing of the past by:
a) Insisting that all new accounts pay by Direct Debit
b) Converting (over time) all existing accounts to Direct Debits
c) Introducing a surcharge for all customers who continue to pay by cheque

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