We all know healthy cash flow is the life blood of any small business, but when your cash flow is interrupted, survival depends on having funds in reserve - and the same is true of your customers.

So it helps to know how many small businesses out there have savings set aside 'for a rainy day', and how many would be unable to pay you if their own income was interrupted.

The figures don't make for encouraging reading - according to a report from British personal and commercial banking providers Aldermore, fewer than one in three businesses have a savings account at all.

Of those that do, 21% have less than £5,000 saved, and 7% have nothing at all.

Changes to the way companies calculate the VAT on invoices that are subject to Prompt Payment Discounts could effectively rule them out as a way of encouraging clients to pay early.

Until now, businesses have been allowed to calculate VAT based on the discounted invoice price, and display this on their communications with customers.

If the customer fails to pay in time to benefit from the Prompt Payment Discount, the business has been able to charge the full invoice amount, without having to recalculate the VAT.

Where do small businesses turn for help when they suffer due to late payment? Under new government plans, there could soon be a Small Business Conciliation Service tasked with tackling that precise problem.

That's not its official name as yet - and in fact, you could be forgiven for thinking you already know of a 'conciliation service' for small business disputes, in the form of mediation.

Risk is an unavoidable part of business, particularly if you provide credit to your clients - even in the sense of invoicing for work done only once it has been delivered, let alone more complex credit arrangements that involve the lending of money.

The new year is always a good time to take a fresh look at things; for many companies it is the start of a new financial year too, while those whose accounting is aligned with the tax year have the first quarter of the new calendar year to put processes in place.

A fundamental characteristic of late payment legislation so far has been its voluntary nature - nobody forces big businesses to sign up to the Prompt Payment Code, and nobody forces SMEs to charge penalty fees on late payments.

Now one organisation is calling for this to change, with a policy paper that suggests making several aspects of late payment legislation unavoidable for creditors and debtors alike.

It doesn't matter how much you like a bucket; if it won't hold water anymore, it's time to get a new bucket, and that is just what the government needs.

They are now embarking on yet another review of the Prompt Payment Code to try and make it actually work, and their plan to do this is to take advice from organisations like the City of London Corporation, Aviva and Barclays.

Premier Foods - owners of the Mr Kipling brand, along with several other household names - have encountered their fair share of negative press recently, since it emerged that they were demanding that suppliers should invest in the company in order to continue receiving orders.

Yep, that's right - suppliers to Premier Foods, many of them fairly small foodservice businesses, were apparently told that if they wanted to keep receiving future orders, they had to put their own money into Premier in the form of investment finance.

For small businesses, the internet has proved to be a great levelling ground, making winning custom less about size and brand power, and more about simply topping the search results.

But as more people prefer to pay remotely for goods and services, are small businesses at risk of losing custom - or worse, going unpaid for work done - due to their lack of good electronic payments technology?

Lord Sugar, the artist formerly known as Sir Alan, has made his feelings on late payments very clear - and, like us, he's less than impressed with the government's efforts to tackle the problem.

In particular, during the second reading debate on the Small Business, Enterprise and Employment Bill, he criticised the lack of "practical, common-sense" solutions to the problems faced by small businesses.

This Saturday December 6th is Small Business Saturday, an annual initiative to support small businesses throughout the UK, and it's not just about visiting your local independent gift shop.

Much of the focus will be on the nation's high streets and town centres, where free parking and special offers will encourage many people to finish off their Christmas shopping at small independent retailers.

Hitting the Headlines: Safe Collections in the Guardian

in About Safe Collections by Adam Home
If you're a Guardian reader, you may have seen Safe Collections' collections and partnerships manager Adam Home quoted in a Guardian Professional article on May 12th. Tim Aldred's piece looked at the case for credit control teams as a way for businesses to…

Hitting The Headlines: The Independent on Sunday

in About Safe Collections by Adam Home
In 2009 our founder and Managing Director was interviewed for a piece in The Independent On Sunday, this article is reproduced below with their kind permission. in 2009 we still went by our original name of Creditsafe Ltd, whilst our name may have changed our…