A third of SMEs unaware of how much money they are owed

Research from the Insight team at Bibby Financial Services shows that more than a third of small and medium-sized businesses are in the dark about how much money is tied up in unpaid invoices.

The research – conducted among 1,000 small and medium-sized enterprises in Q3 – found that 36 per cent of SMEs in the UK were unable to say how much was still owed to them.

Of businesses that did know of their outstanding payments, almost a third (31 per cent) were owed more than £20,000, whilst more than one in 10 (14 per cent) were owed more than £50,000.

Sectors affected

Among the most impacted, those in the hospitality sector faced the biggest issue, with two thirds (67 per cent) of SMEs unsure of the amounts owed to them. And almost four in ten (39 per cent) transport and distribution SMEs also admitted to uncertainty about unpaid invoices.

Many UK-based businesses are somewhat helpless when it comes to enforcing prompt customer payment. But with more suitable forms of funding now available to those with cashflow problems, outstanding payments needn’t be an issue.

Taking control

One solution for businesses struggling to manage their cashflow due to late customer payment is Factoring. This is a funding and collections service, where credit control and sales ledger management are outsourced to a professional team, enabling SMEs owners and staff to focus on running their businesses, safe in the knowledge that invoices are being chased and payment collected.

If you would prefer to manage your own credit control and would benefit from upfront payment, Invoice Discounting could work for your business. This is a funding-only service where a percentage of the outstanding invoice is provided immediately, enabling you to fulfil existing orders, in addition to developing new business.

Over 40,000 businesses throughout the UK use solutions like Factoring and Invoice Discounting from providers like Bibby Financial Services. In fact, we’ve provided cashflow solutions to businesses across 300 industry sectors for over 30 years so have the knowledge and experience to help your business.

If you’d like to find out more about Factoring or Invoice Discounting, or if you have any questions about how either work, visit: www.bibbyfinancialservices.com or call 0800 91 95 92.

About the Author

 Andrew Darling is a specialist in invoice discounting, factoring and trade finance solutions and has worked in financial services for over 35 years. He is currently Corporate Manager at Bibby Financial Services where he works with high-turnover businesses. Andrew has been with Bibby Financial Services for over 10 years and specialises in corporate finance for businesses with turnover of £5 million or more.

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