20 per cent of small businesses are running into cash flow problems due to late payments. Experts have stated that collectively the issue of late payments costs small businesses around £2.5 billion a year.
Official numbers estimate a third of payments to small businesses are late, with the average value of each payment at £6,142. Some businesses put this down to the chaos of Brexit having an impact on the market.
More than 50 per cent of professional service firms have confirmed their belief that Brexit will be good for business due to the amount of changes that will be enforced.
Regulatory and taxation laws could very likely be changed to encourage external companies to engage in the UK economy to the benefit of UK SMEs.
Although according to research carried out by experts, 39 per cent of British SMEs believe that leaving the EU will make them worse off.
Ironically, 39 per cent believed they will be unaffected. If nothing else, this is an accurate representation of how divided all aspects of UK business is, across the board.
Corporate and mid-market experts have said: “Slow payments to businesses are a systemic issue in the UK, and indeed in other countries. About 30 per cent of payments to small businesses are late from the Minister for Small Business, Consumers and Corporate Responsibility, Kelly Tolhurst MP.
“The average value of each of those late payments is in excess of £6,000 – that’s absolutely gigantic. 20 per cent of small businesses are running into cash flow problems because of a late payment.
“If you add up all the current late payments in the system, it comes to about £2.5 billion a year, the director reveals to Accountancy Age. So that is a big problem for SMEs, it puts a lot of pressure on cash-flows and creates an awful lot of stress for business owners.”