Many SMEs are aware of the importance of a 'level playing field' when it comes to prompt payments - including the right to be paid on time by big brands, without them using their clout to negotiate longer terms, or their complexity as an excuse for failing to pay at all.
But when you start trading across borders, things can very quickly become even more complicated, because in other countries, even small business clients might be used to significantly different payment terms than they would be in the UK.
This is perhaps most relevant when trading outside of the EU, where unpaid debts can be more difficult to pursue, but even in light of the EU Late Payments Directive, introduced in March 2013, there are still discrepancies closer to home.
Europe off balance
Bibby Financial Services recently pointed out the discrepancies that exist between some of the biggest economies in the EU - including the biggest of them all, Germany.
In the UK, for instance, just 24% of businesses expect to be paid immediately for work done, with most offering payment terms of between 30 and 60 days; in Germany, broadly speaking, the reverse is true, with 79% of businesses requiring immediate payment by customers.
Elsewhere in the world, immediate payment is expected to a greater or lesser extent, including 46% of businesses in the US and 31% in Hong Kong (the remaining 69% surveyed here said they offer payment terms of between 30 and 90 days).
Content continues below
Many small businesses are caught out when clients refuse to pay their invoices. For a small startup, a handful of unpaid invoices can make the difference between a healthy bank balance and a full-on…
When working with clients who are based overseas, there are several things you should take into account - ideally, from the moment you begin working for them, rather than later in the process when…
EU legislators have been working for two years on a 'right to be forgotten' - specifically, the right to request that information about your past should be removed from the Internet, or made…
Following on from part one "Going Dutch: Contractor Debt Recovery in the Netherlands" we speak to Alex Tucker, the contractor who found himself at loggerheads with the Dutch agency and find out more…
Despite the unparalleled prompt payment culture in Germany, some 26% of small firms said they struggle to make the most of the business opportunities available to them, broadly in line with the UK (24%), and the two countries together struggle the most, compared with a global average of just about 20%.
Does this mean Germany's prompt payment culture is not helping SMEs? Not necessarily - it could be that to maximise their potential, companies must export, at which point the erratic pattern of payment in other countries of the world becomes just as much a hindrance to them as to anybody else.
Oak Exports is a British exporter of non-perishable foods, and company director Stuart Dunbar told Bibby Financial Services that some companies will inevitably take longer than is technically permitted to pay their invoices.
"It's a bit like speeding limits; some people will reach the limit and push it further. '60 days' is usually 70-75, '90 days' can be in excess of 100."
International debt collections
As we have mentioned before, amounts owed to you from overseas can be difficult to pursue, due to the complexities that trading overseas can bring. Differences in time zones, language, customs and law can all make recovering funds overseas extremely challenging.
If you are trying to begin a claim internationally, our overseas agents will be able to help; we work with a network of trusted partners throughout the EU and worldwide who can effectively counter the problems that come from having an overseas debtor. Time and again our agents have shown that when it comes to repatriating funds, local reach and knowledge can be all important.
And with with 30 years of experience in this field we have an extensive number of reputable and reliable collections agents in almost every country on Earth, giving you the local contact you need to collect your international debts.
Over 150 Years Of Industry Experience
Our modest but highly skilled team has a combined total of over 150 years of experience in commercial credit management and B2B debt collection. From independent IT contractors to major film and TV publishers, Safe Collections has the knowledge and experience you need to get paid quickly and cost effectively.
Image byflickr user Mishel Churkin is licensed under CC BY 2.0