'I lost the invoice' biggest excuse for late payments to SMEs
London - July 12th, 2014
- 32% of SMEs state ‘Awaiting a late payment’ of their own as the second most common excuse for late payment
- A third (34%) of UK SMEs are forced to write off thousands of pounds of bad debt every year
- A quarter of SMEs (24%) believe the issue of late payments has in fact deteriorated over the last two years. Only 17% believe there has been an improvement
New findings from Satago1, the automated credit control specialists, have revealed the top excuses given to UK SMEs from late paying customers. ‘Invoice not received or lost’ tops the table with more than two in five SMEs (44%) highlighting it as the most common excuse. This is followed by the inability to pay because they are awaiting late payment (32%) and disputing the invoice after the contract is agreed (13%).
Some of the more inventive excuses include ‘I thought I was going to inherit some money from my mother, but she is still alive.’ A number of SMEs have come across bad payers who have faked deaths to get out of paying.
Other creative excuses include ‘I accidentally shredded the invoices’; ‘someone stole all the paperwork’ and the old classic of ‘the dog ate it’.Top excuses for late payments Invoice not received/lost44% Unable to pay because they were awaiting late payment32% Invoice dispute - after contract agreed13% Person responsible for payment has left the business12% Customers attempting to renegotiate payment terms mid contract11% Invoice dispute - with no contract in place7% Payment paid to different company / account5%
Satago has launched a payments service that allows SMEs to step away from the ongoing labours of dealing with late payers. It offers an automated credit control service that tracks late payments and sends automated email and letter reminders to offending customers, allowing users to either use it as “set and forget” automated accounts receivable, or to make their own credit control process more efficient.
Steven Renwick, founder and CEO of Satago said:
SMEs are the lifeblood of the UK economy and we must ensure these businesses are rewarded for the work that they do in a proper and timely fashion.
With many SMEs believing the issue of late payments is deteriorating, they must organise themselves to remove some of the stresses of chasing bad debtors. Almost half of all excuses are based around lost invoices so SMEs can make a great start at chasing down these payments by working with a credit control service to send invoices and reminders to offending customers.
Late payments are detrimental to the livelihood of small businesses. Satago found that every year, more than a third (34%) of UK SMEs are forced to write off thousands of pounds of bad debt. Even with government and industry action, the findings show that there has been limited impact as a quarter of SMEs (24%) surveyed believe the issue of late payments has in fact deteriorated over the last two years. Only 17% believe there has been an improvement.
Notes to Editors:
397 SMEs were surveyed by Consumer Intelligence on behalf of Satago 20th - 23rd May 2014.
Georgia Hanias | Patrick Evans | Amrit Nijjer
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