Another week, another tale of company administration, job losses and suppliers facing an anxious wait on whether they’ll ever get anything back on unpaid invoices.
The collapse of Flybmi, the small regional airline based at East Midlands Airport, has resulted in the ‘majority’ of the company’s 376 staff being laid off with immediate effect. Following Monarch last year, it is the second UK airline to go under in less than 12 months.
Sadly, after reporting in our last blog on the issues digital magazine The Pool was having with paying freelance contributors, its financial issues have come to a head. Talks to save the ailing publication with an injection of new cash apparently made no headway and it has entered administration.
As well as meaning 20-plus members of staff now face redundancy, the development leaves freelancers who are still awaiting payment on long overdue invoices in an even more precarious position.
Lifestyle magazine The Pool has suspended all freelancer commissions after it emerged it was facing a sizeable backlog of late payments owed to contributors as well as to staff.
New editor Cate Sevilla took the decision to halt all new work requests for freelance journalists and photographers, including from regular columnists, after being inundated with queries over unpaid invoices since she took the job in September.
So it is that time of year again, businesses are scrambling to get things finished for the big Christmas shut down and, for a few days at least, you can leave your problems in the office - no chasing invoices, no worrying about cash flow, no playing the diplomat with awkward suppliers or clients.
But at the risk of dampening the festive spirits, it is only a temporary respite. Those payments you are struggling to get finalised will still be outstanding come January. But on the other hand, the New Year is always a great time to make a fresh start. So as our Christmas present to you, here is our 12-step guide to what you can do to maximise your chances of getting paid on time in 2019.
The rhetoric surrounding the UK’s late payments culture was ramped up another notch this week as an influential Parliamentary committee recommended a mandatory 30-day payment term to stamp out the problem.
Publishing its Small Business and Productivity report, the Business, Energy and Industrial Strategy (BEIS) committee concluded that ‘disgraceful’ behaviour by big firms in particular on payments was seriously hampering output and growth amongst SME suppliers.
It’s a phrase that has become a mantra for personal injury and small claims lawyers. Imported from the US legal system in the mid-90s, No Win, No Fee is the consumer-friendly name given to a method of claims financing officially known as a conditional fee agreement.
It more or less works as the two names suggest - payment is conditional on the case being won. This means litigants don’t have to raise funds up front for expensive legal action, it is the lawyers that take on the risk, and final payment is usually taken as a percentage of the compensation won.
Action Fraud are warning UK based consumers and businesses to be aware of a new type of financial scam, fraudsters claiming to be bailiffs are sending sending SMS messages or making calls to targets across the UK in the hope of pressuring them to pay fictitious debts.
The scam sees victims receive texts by the fraudsters about the fake debt, claiming that they will "attend your address for resolution" if payment of the imaginary debt is not made.
It feels like we have been here before somehow. Lots of well-meaning words, a tough-sounding stance… and then what? Rinse and repeat.
The latest announcement from the government on the subject of late payment culture has come in the form of a “call for evidence” from Small Business Minister Kelly Tolhurst specifically on how to end the abuse of SMEs by large corporate clients.
It's not often a company like ours faces problems with payments, after all most of our customers are more than happy to be charged by us as this usually means we have recovered what they are owed. But like all businesses we occasionally encounter issues with clients that don't like to pay on time, or in fact at all. That's why we've chosen to open our "2018 Safe Collections - Late Payment Hall of Shame" featuring companies that have failed to honour their agreements with us.
Just under half of large businesses admit to paying suppliers late to protect their own cash flow, according to a new report.
In the UK Business Payments Barometer 2018 survey carried out by Bottomline, 44% of businesses with between 250 and 10,000 employees said they pay invoices late in order to protect liquidity or prioritise other payments.
This comes just a year after the government introduced its Duty to Report (DTR) regulation requiring qualifying large businesses to publish information on payment practices, including average time taken to settle invoices.
Applicable to any company with more than 250 employees, £36m turnover or £18m on the balance sheet, the government hoped DTR would help to tackle late payment culture by bringing the worst excesses out into the open. If these latest survey figures are taken as a gauge, it is yet to work.