Late Business Payment

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The business world is a two way affair between Customers and Suppliers. Whilst things look gloomy on the payment front, customers will look at legitimate ways to delay payment.
Legitimate ? ? Yes, they may ask for extended terms. They will want to do this to create a buffer in their business. They don't want to be subjected to business debt collection agencies knocking on their door. They don't want to have a company credit check show them as a bad risk.

Banks have been concentrating on quantity of loans and will now look closely at the quality of loans with their accounts. A shift may take place to convert interest only loans into other types certainly ones which show payment to the capital. Banks will not be too concerned about losing customers who don’t like it as other banks will not want to pick up the business.
The credit cycle is tightening, it’s a knock on effect.
One business starts to tighten its terms and it cascades right down the supply chain.

Make sure you and your staff are on the watch out for the tell tale signs of late payment. These are numerous, amongst them are late delivery of cheques, bouncing cheques and excuses over the telephone.

Look at your existing businesses now, any which are showing signs of slowing their payment should be monitored regularly. Overdue Accounts which are allowed to stay that way are difficult to turn round. Don’t forget that if customer has problems now in paying outstanding debts, then it will be hard to catch up unless his customers start to pay monies owed to him on time.

Debt recovery from a company on the slide is a hard thing especially if they have been with you for a long time. Tough decisions need to be made especially if you have developed close personal times with the key players.

New customers need to be subjected to a normal company credit check there is no harm in vetting them using other industry sources. Information can be gleaned from Companies House and any of the other credit referencing companies which use their information.