Small businesses across the UK are still chasing £14.9 billion in late payments resulting from goods and services they have provided, according to new research.
The study claimed that on average respondents were owed £11,000, which extrapolated to £14.9 billion across the UK’s 5.7 million small firms.
The survey was conducted by Liberis, a small business finance provider. It found that the amount small businesses in the UK are owed has increased by almost £1 billion in six months, preventing firms from growing to their full potential.
The research, which polled over 400 SMEs in the UK in March, found that 58 per cent of small firms are currently owed up to £10,000 with 27 per cent owed more than £20,000.
In addition, 50 per cent of respondents claimed that aged debt has hindered investment in their own business, while 72 per cent said they spent three days a month chasing money they were owed.
“The Government continually stresses the importance of small businesses to the nation’s economy,” said Rob Straathof, Chief Executive of Liberis.
“But with mounting debts owed by their clients and customers, some SMEs are at breaking point.”
In June, FSB published a report on supply chains with particular attention to the collapse of construction firm Carillion and the ensuing impact on many small businesses who remain unpaid as a result. FSB urged good supply chain practice from the private sector, while looking for Government to require companies to provide accountability for their supply chain practice.
The full report can be read here