Chasing debt a reality for all businesses

All businesses, in fact all entrepreneurs in the UK today know that getting debt owed to them paid is problematic. Chasing debt has become a harsh reality in our depressed current economy. When people owe you money they find the most wonderful excuses not to pay the debt and in the end you own business could start suffering. This means you have to start chasing debt which leads to stress you should not be exposed to.

Time consuming

Chasing debt is hugely time consuming, especially for the smaller businesses that do not have debt collecting department. It is a frustrating endeavour that takes time away that can be used much more fruitfully in running the business and canvassing new clients. Extra time is wasted as the majority of businesses do not want to go over to legal action. This means they will continue chasing debt fruitlessly for far too long. In today’s economic climate no business can afford to waste their valuable time in this way.

Outsourcing

Instead of allowing debt to start impacting your business negatively, place the burden in professional hands and let them set about chasing debt for you in a highly effective manner. An expert company has all the resources and processes in place to do get your debtors to pay and they have years of experience backing them up.

Benefits

When you sign up with Invoice Chasing you simply upload your unpaid invoices via the dashboard provided onto their website. Chasing debt then is done in your stead and usually results in faster payments of debt. Your debtors still pay you directly, thus no money is taken off the top. You get reports on the progress made in chasing debt on your behalf. You get advice on many aspects regarding unpaid debt and the various solutions available. You have 24/7 support as everything is web based giving you real time access.

Peace of mind

For a set monthly subscription fee you can upload your unpaid invoices as they occur and rest assured in the knowledge that whatever chasing debt has to be done will be done for you. You also have the assurance that all actions will be done in a professional manner that will not leave your defaulting clients feeling harassed or set upon and that their dignity stays intact. There are many ways of chasing debt, but it should always be done legally, professionally and not harm relations between your company and your debtors. With Invoice Chasing you have complete peace of mind that this is how all business is handled.  www.invoicechasing.co.uk

An accountancy firm is warning small companies that they cannot rely on the Government’s Time to Pay scheme, a recession measure which was made permanent in last week’s Budget.

Birkenhead-based Woods Squared, which specialises in business growth advice for small firms, says that although it has been successful in accessing the scheme for clients, it is hearing of other recession stricken firms being rejected.

Time to Pay, which allows companies to spread payment of VAT and Corporate Tax over a number of months instead of paying in one lump sum, was originally an emergency measure to help firms through the credit crunch.

Business owners need to plan better

Woods Squared Director Alan Woods said small business owners anxious about their cash flow now had to ‘grab their finances by the scruff of the neck’ and plan better.

“The Time to Pay scheme has merit but it can also just be papering over the cracks of deeper financial problems,” he said. “The reality is that of the 300,000 agreements the Government has signed, some have been with the same firm. The actual number of firms helped is 168,000, so there is no guarantee you will be accepted. So the key message to small business owners is to plan their finances. Most financial problems arise precisely because of a lack of strategic planning and a lack of understanding about how to manage finances. It is vital in this climate to properly understand how much you can spend and how much tax you have to pay. Then you have a clear idea of what you have to do to grow your business. Too many businesses are misunderstanding the tax system, fundamentally underestimating their tax liability.”

Mr Woods said growing a business requires effective cash flow management, monitoring actual cash flow against projections.

“Businesses are sleep walking into problems simply because they look at projections and not actual figures,” he said. “So we would urge business owners to seek professional financial planning advice to avoid and predict problems at the earliest stage. If your accountant only does your end of year accounts and no more you need to look at a more proactive service which helps you with your week to week and month to month finances. We know there are lots of good profitable businesses out there who are being tripped up by poor financial planning. Many of these firms are then looking to the Time to Pay scheme to bail them out. But the scheme can’t be relied upon especially for firms who have mismanaged their finances in the first place as they are unlikely to be accepted.”

Cash flow is the lifeblood of any business

Mr Woods urged small firms keen to grow and avoid financial problems to ‘head problems off at the pass’ and implement a robust credit control procedure.

“Cash flow is the lifeblood of any business and you need to do all you can to keep that lifeblood flowing consistently and strongly,” he said. “We advise asking all clients to pay by standing order, or direct debit, rather than cheque so you have a nailed down payment date which can’t be pushed back. If a customer refuses to do this, make clear what your payment terms are and consider suspending work or charging interest until payment is made.”

Mr Woods said it is wise to have a set procedure for chasing payment as soon as the invoice has been sent.

“Check immediately with the customer that it has received your invoice and ask when you can expect payment,” he said. “This lets them know you are on the case and are alert to any potential problems. It is critical that the client is aware that you are prepared to chase payment hard. That way they are more likely to pay your invoice before invoices which are not being chased. It stands to reason that the suppliers who do not chase payment and do not enforce sanctions will be paid slower than those that do. Communicating with the client regularly also encourages them to resolve problems and inform you if there are difficulties.”

From: http://snipr.com/vbdqq

For your company invoice chasing use www.invoicechasing.co.uk

Chasing late payments could be costing the small business community a total of £1.9 billion a year.

Of 300 business owners and managers, 35% say they are finding customers are taking longer to pay invoices than 12 months ago, new research conducted by Bibby Financial Services has found.

Some sectors are suffering more than others. 47% of manufacturing and construction companies say that customers are taking longer to pay, a further 36% of firms in business services said the same.

At least 20% of small businesses say they are chasing each invoice at least three times and an unbelievable 48,000 businesses have had to follow up invoices more than 11 times.

According to BACS, small businesses are currently owed a total of £30.4 billion.

Alistair Darling vowed that the Government will pay 80% of its invoices from small businesses within five days, which is a reduction from 10 days, during the Budget announcement last week.

Edward Rimmer, Bibby Financial Services’ UK chief executive, commented:

“The UK business community has got to stem the tide. We cannot keep stalling payment and expect it to have no consequence. Across this nation, businesses are fighting for survival with sustaining a healthy cash flow one of the biggest challenges. We need to support one another and do everything possible not to succumb to the easy route of late payment as it can become a vicious circle”.
From: http://snipr.com/v6c7l

To improve your cash flow use www.InvoiceChasing.co.uk

The figures, compiled by CreditPal, suggest that 43 per cent of small and medium sized enterprises (SMEs) have suffered at the hands of bad debt over the past two years, with the average firm losing out to the tune of £7,500 as a result of clients or partners folding.

London-based firms were the hardest hit by insolvency losses, either as a result of higher failure rates or larger debts. There is expected to be a significant rise in both corporate and personal insolvencies during this year and next, as company failures traditionally peak around 18 months after the end of a recession.

Bad debts can be enough to cripple an otherwise financially viable company. But very few firms take steps like credit checking their customers before doing business with them. Similarly, a very small number have a clear process in place for chasing late payment.

Products like factoring and invoice finance are likely to be increasingly useful for firms that wish to keep a firm grip on their credit control, and avoid the peril of defaulted payments

As an invoice chasing customer, you have the facility to credit check your potential customers before entering into an agreement with them.  You also have our professional team of invoice chasers helping you to get paid on time.  For more details, visit our home page at www.invoicechasing.co.uk

1. I can’t afford to pay you until my customers pay me

2. The cheque’s in the post

3. I’m not paying, there’s a dispute

4. I have not received the invoice

5. I returned the invoice

6. The authorised signatory for the cheque is not in the office

7. The director/owner has died

8. We have ceased trading/are in liquidation/receivership

9. You will have to wait until we have paid higher priority suppliers / creditors

10. I’m in the process of changing banks

Invoice Chasing – your credit control department.  Sign up at www.invoicechasing.co.uk.

In 2009, the Federation of Small Businesses carried out a survey which found that small business were waiting up to four months on average to get their invoices paid.  Well over 4000 businesses failed last year due to late payment.  Cash flow is imperative to the success and development of a business yet credit control is something that is often neglected.  Do not let your business fail due to late payment by your debtors.  Stay in control.  Let Invoice Chasing become your credit control department.