Late payments costing SMEs £51.5bn
Late payments are costing SMEs an estimated £51.5bn (€56.7bn), according to research from Hitachi Capital UK. A survey of 1,000 SME owners found that almost a third of SMEs (31%) have experienced late payments costing their business at least £10,000 in the last 12 months. The study found that 27% of SMEs have experienced a profit squeeze because of late payments, and 12% have had to defer staff pay, equating to an estimated 1.95m UK employees that have been left empty-handed on payday. Around 40% of respondents have been forced to use their own money to address cash flow gaps in their business. The majority of these respondents (80%) have invested personal savings to keep their business afloat or operational. Nearly three quarters of SMEs (74%) have had a customer fail to pay during their agreed terms at least once during the last 12 months, and 34% of SMEs report customers using their position to delay or r educe payment.