|
Cash Flow
Written by Administrator
|
UK Businesses Are Suffering From Cash Flow Problems
Many UK businesses constantly suffer from cash flow problems. This is caused by an economy which is still suffering the after affects of the recession. Cash flow problems cause other businesses to suffer cash flow problems and it can be a vicious cycle.
To add to this, cash flow problems stop businesses from growing and thriving which in turn stops them from employing more people. The affects of a lack of cash flow is not isolated to the businesses that it affects.
NatWest have collated some interesting statistics. 1 in 5 companies are owed a staggering £50,000 to £100,000 in payments which are late each and every month. Manufacturing companies were on average more susceptible to bad debt than most other types of business. This sort of debt can cause some major problems for businesses.
Even government agencies and local councils have a habit of paying late and therefore causing cash flow problems to many of the businesses that they owe money to.
One way to help your cash flow problems is to use invoice factoring and invoice discounting services which can help to ease the burden of debt. The only problem with such services is that they tend to cost you a fair bit and can cut into your profit margins.
|
|
Bad Debt
Written by Administrator
|
Barclays reports increase in bad debt provision
By Katherine Griffiths
Barclays, the fourth-largest UK bank, yesterday announced it had increased its bad debt provisions to underwrite its recent rise in lending to customers. The bank, which had £277m of bad debt provision last year, said this had risen "in line with increased activity".
Barclays, the fourth-largest UK bank, yesterday announced it had increased its bad debt provisions to underwrite its recent rise in lending to customers. The bank, which had £277m of bad debt provision last year, said this had risen "in line with increased activity".
This follows its expansion in consumer lending, which has "grown strongly relative to the market". Barclaycard also continued to expand, as the bank has targeted other European markets and issued more than 1 million cards outside the UK.
In the hotly contested mortgage market, Barclays said its policy to sell Woolwich mortgages in its branches had added new business. This follows Barclays' acquisition of Woolwich last October.
Barclays' announcement yesterday was the last opportunity for the bank to guide the market on its progress before its six-months results on 2 August as part of the summer banking reporting season. Its shares rose 30p to 2149p. Reflecting the presence of the Woolwich business on the balance sheet, the bank's overall margin declined year-on-year because of the enlarged contribution to earnings of low-margin mortgage business. Barclays said it was on track to deliver the forecast £80m in pre-tax synergies this year from the acquisition. |
|
|
Worst Offenders
Written by Administrator
|
British corporates are worst offenders in £24 billion late payment debt
May 25 2011
Large corporates are responsible for many of the late payments making up the massive £24 billion owed to British small and medium sized enterprises (SMEs), according to research from Bacs, the organisation behind Direct Debit and Bacs Direct Credit.
British corporates are worst offenders in £24 billion late payment debt
* 33% of SMEs say corporates don't pay on time
* Payments delayed by up to 52 days
* Late payment from public and third sectors improves
* 158 million man hours lost to chasing overdue bills
* Half Britain's SMEs fall victim to late payment
*£27,000 - average amount owed
Large corporates are responsible for many of the late payments making up the massive £24 billion owed to British small and medium sized enterprises (SMEs), according to research from Bacs, the organisation behind Direct Debit and Bacs Direct Credit.
But, in contrast with the commercial sector, the public and third sectors are meeting more of their bills on time - SMEs experiencing late payment on invoices to government and not-for-profit organisations almost halved from 11% to 6% in the last six months of 2010.
Bacs newest late payments research shows a third of SMEs reporting that big businesses are behind late bill settlement. And those operating in the manufacturing industry are most likely to suffer delay at the hands of the big corporates, where 41% of the sector's SMEs experiencing late payment said large companies were to blame for overdue invoices.
More than half (53%) of the country's SMEs have experienced late payment -that's up from 45% in June 2010 - with the average owed at any one time standing at £27,000. And when SMEs do finally get paid, the length of time they've had to wait is an average of 39 days beyond agreed payment terms, an increase of nearly eight days since June 2009. That rises to almost 50 days within the distribution sector, while businesses in the North are waiting an average of 52 days longer than anticipated - that's almost two months.
The burden of chasing overdue invoices is also impacting on smaller British businesses, as they're forced to spend an average of ½ a day every week pursuing payment. That equates to more than 158 million¹ man hours lost to the British economy just in chasing bill settlement.
Mike Hutchinson, head of marketing at Bacs, said: "Late payment remains a big problem for British SMEs with £billions overdue against bills, causing small businesses to use up millions of man hours in chasing invoice payment. Cash flow is an essential business priority, particularly in a period of economic uncertainty, and we urge SMEs to consider turning to automated payments wherever they can to manage the money which is under their control." |
|
|
|
|
| |
