The issue of late payments is having a severe impact on UK businesses, with a recent estimate by QuickBooks highlighting that one-in-seven firms have been unable to pay their employees on time as a result of cash flow issues.
Some businesses have even had to turn down projects as a result of being unable to pay staff members to carry out the work, suffering a loss of around £26,000 on average.
The survey conducted by QuickBooks highlighted that as a result of late payments from clients or customers, many businesses were forced to delay wage payments - with up to an estimated 2.2 million UK workers not being paid on time as a result.
QuickBooks’ research also showed that smaller firms carry an average of approximately £31,055 in late payments, and this dramatically affects not only their ability to pay employees but also to pay debts.
Difficulty paying debts was indicated by around one-third of the companies involved in the survey.
However, the most significant impact of late payments is felt by those professionals who are self-employed. QuickBooks noted that those who are self-employed are 2.5 times more likely to suffer cash flow issues than small businesses.
It has been widely publicised that Philip Hammond, UK Chancellor of the Exchequer has been actively cracking down on late payments, including having non-executive directors appointed in larger firms to handle late payments.
National Chairman of the Financial Stability Board (FSB), Mike Cherry,
“The commitment from the Chancellor that the Business Secretary will see this through is welcome, and we are especially pleased that the first measure has been announced. … The end of late payments could finally be in sight. It can’t come soon enough, to bolster small businesses at a time when they are in great need of support and a lift in confidence.”
It has always been clear that late payment is a significant problem for both businesses and the self-employed in the UK. However, the impact on employees is something we don’t often consider. When you are facing difficulties in getting paid by your clients or customers, the last thing you need is to lose your best staff members as a result. Debt recovery can make all the difference to the survival of your business and Yuill + Kyle can help.
We offer a comprehensive debt recovery service, from cost-effective pre-sue action through to enforcement of decrees. To discuss your specific challenges and requirements with someone that can help, get in touch with us today.
If you need advice or assistance with debt recovery, contact our team of experienced solicitors today. We offer an efficient and cost-effective service to help get you back on track. You can call us today on 0141 331 2332 or complete our online enquiry form, and we will get back to you right away.
We look forward to helping your business thrive.
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