Late payments put SMEs and jobs at risk – Business news 2 November 2021

James Salmon, Operations Director.

Late payments put SMEs and jobs at risk. Think-tank warns of worker exodus. Lloyds: Business sentiment edges down. Confidence dips among business leaders.  And more business news.

Late payments put SMEs and jobs at risk
New research has warned of the impact of late payments on SMEs, saying the issue could see a number of firms struggle to survive after the coronavirus crisis.

A survey from Penny Freedom shows that two thirds UK SMEs have at least one late payment on their books, with an average value of £15,370, while a YouGov poll of SMEs found that 62% regularly experience late payments and 62% spend time each week chasing overdue invoices.

With six million small businesses in the UK that means up to four million businesses are  struggling to get paid for products and services they’ve provided.

Late payments force those  businesses affected to live from hand to mouth,  rather than be able to make longer-term plans for growth and expansion. As a result, long term investment is suspended or over-looked. This has long term affects on growth and profitability.

The time, energy and resources sucked up by late payments causes significant damage and sucks up resources that could otherwise have been used productively, growing the business.

There is no doubt that the pandemic has made this dire cash flow situation worse, with obstacles to trade, staffing issues, shutdowns, increased levels of debt and reduced cash-flows.

A report from the European Commission also shows that in the UK, 30% of businesses indicated that late payments had links to subsequent redundancies, compared to 35% of businesses in Germany, 28% in Spain and 25% in France.

Late payers must also appreciate the risk they are causing to themselves. By holding back payments from their suppliers, they are damaging those suppliers’ prospects and means their key allies may fall behind competitors in innovation and growth to their operations. And should their suppliers cease trading because of late payments, this can lead to severe challenges and delays to the late payers themselves as they must find new suppliers for those products and services for their own business.

The message is as clear as ever that late payments can cause critical damage to the UK economy and hold back the UK’s 6 million small businesses who feel the impact hardest.

Credit insurer Euler Hermes says up to 15 per cent of the UK’s SMEs are rated ‘fragile’ and risk insolvency during the next four years as Covid-19 state support schemes are withdrawn.

The UK is at a crossroads!

We can either see 2022 as a year when SMEs can bounce back and thrive! Growing and driving a UK economic recovery and seizing the global opportunities before us.

Or 2022 can be the year when SMEs struggle as support measures are withdrawn and as a result the UK economy gets trapped in a spiral of stagnation, low growth and business failure?

How we tackle late payments will be key to the answer!

Are you struggling because of late payments?

Are you unable to pay overheads on time?

Do you face difficulties paying staff salaries?

Are you forced to be reliant on external financing to make up the gap in your cashflow caused by unpaid invoices?

With rising interest rates and emergency covid funding coming to an end, it is vital that that the issue of late payments is addressed.

The Credit Protection Association has been tackling late payments for over 100 years.

To find out how we can help you,  just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Other business news

Think-tank warns of worker exodus
A survey by Autonomy, a think-tank specialising in work-related matters, suggests that companies need to offer higher pay, a shorter working week or enhanced benefits to prevent an exodus of staff over the next 12 months.

The poll of more than 1,000 workers in the care, transport and logistics, and hospitality industries saw 41% say they are considering leaving their job in the next 12 months.

The majority of those considering quitting said they have been offered no incentives to stay by their employers, with dissatisfaction driven by issues including low pay, long working hours and mental health concerns.

Will Stronge, Autonomy’s director of research, said that while the labour market crisis “can be solved fairly easily by offering better working conditions … the response by companies is falling far short of what is needed.” He added that the pandemic has “shone a spotlight on unfair and precarious working practices” and warned that “it seems that workers have simply had enough.”

The Autonomy report also notes analysis from the shareholder advisory firm PIRC which found that three-quarters of the largest companies listed on the London Stock Exchange cite labour shortages and staff retention as principal risks to their business.

Lloyds: Business sentiment edges down
A survey by Lloyds shows that British business sentiment fell slightly in October, having reached its highest since the start of the pandemic in September.

The Lloyds Bank Business Barometer fell to 43% in October from 46% the month before. While confidence has dipped slightly amid rising energy bills and supply chain disruption, the reading remains well above the long-run average of 28%.

The study shows 45% of firms expect to increase their prices, up from 37% and passing the previous high of 44% seen in March and April 2018.

The poll also found that 60% of the firms surveyed plan to bring all their remaining furloughed staff back to work, while a further 30% expect more than half of their furloughed workers to return.

Reflecting on the findings of the survey, Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, said: “While economic optimism saw a slight dent in October due to rising costs and the on-going supply chain issues, it is clear that firms are still feeling relatively buoyant.”

Confidence dips among business leaders
Research carried out by the Institute of Directors (IoD) has found that concerns around supply chains, inflation and worker shortages have hit the confidence of UK businesses, with optimism about the prospects for the economy falling from -1% in September to -6% in October. This marks a steep dip on the 27% recorded in June.

The report also reveals that a third of firms expect staffing costs to increase in the next year. It was also shown that 77% of business leaders think costs will stay high in the long term.

Kitty Ussher, chief economist at the IoD, said: “Directors are still nervous about the state of the UK macroeconomy, in contrast to the exuberance of the early summer, with October’s data continuing to show more people pessimistic than optimistic about prospects for the wider UK economy in the year ahead.”


Macron has backed down from threats to escalate the trade row over fishing rights. He had threatened to apply further customs controls to British goods.  He has now agreed to allow time for further negotiations.


In Glasgow, nations have been focusing on a pledge to reduce methane emissions to 30% below 2020 levels by 2030. Talk has also been on reversing deforestation in the 100 nations that hold 85% of the world’s forests in return for $19billion in funding.


Gas prices jumped 15% yesterday after Russian flows slowed due to pipe damage in Bulgaria and Algeria stopped some shipments to Spain after a deal to ship via Morocco expired.


BP was boosted by surging energy prices. It announced earnings of $3.3 billion above consensus expectations ($3.1billion),  the previous quarter ($2.8billion) and the same quarter last year ($0.1billion).

400k firms stuck in business rates appeals system
More than 400,000 businesses are stuck in the business rates appeals system, with firms registering 446,620 checks against their business rates bills since April 1, 2020. This is the first stage of the appeals system in the check, challenge, appeal process.

The analysis shows that almost three quarters of the 605,530 appeals registered since the 2017 Rating List began four and a half years ago were registered in the last 18 months. Of 112,260 challenges – the second stage in the process – there are still 63,780 outstanding.

Real estate firm Colliers said the figures highlight the disruption endured by businesses during the pandemic, noting that while ministers pledged to introduce a £1.5bn relief fund to help firms, the related legislation has yet to pass through Parliament and none of the fund has been handed to firms. John Webber, head of business rates at Colliers, said firms have been left in a “no man’s land”, with the ratings industry and businesses left “very much in the dark” over how to apply to receive the relief fund.

Standard Chartered

Standard Chartered followed the other major banks, as it said its third-quarter profit more than doubled, as income rose and credit impairments fell. Pre-tax profit for the three months through September jumped to $996 million, up from $435 million year-on-year.Operating income rose 7% to $3.77 billion and credit impairments dropped 70% to $107 million


Hiscox said its gross premiums written for the first nine months of the year is up 6.1% to to $3.46bn. Its London market did particularly well, with gross written premiums up 7.1%. Huge weather events continue to play a large part in the global insurance and reinsurance market and Hiscox said it has $110m net reserved for the impact of Hurricane Ida, based on an insured market loss of $35bn and $40m net for the recent European floods, based on an insured market loss of $9bn.

Chancellor warned over risk of missing deficit targets

The Office for Budget Responsibility (OBR) has warned Chancellor Rishi Sunak that the ‘wiggle room’ – the spare money available to cut the deficit and simultaneously reduce national debt – is at the second-smallest level on record.

OBR chairman Richard Hughes told MPs that the Treasury it could be in for a “wild ride” and may struggle to hit its new deficit targets, especially if interest rates rise. Treasury Select Committee chairman Mel Stride said there was a “strong risk” the targets will not be met, with modelling putting the likelihood of meeting the targets at between 55% and 60%. Mr Sunak, who also faced the committee, said that while hitting the targets would be a challenge, he would probably describe the chance of success outlined in the OBR forecast as “better than a cat in hell’s chance.”

Mr Stride also told the Chancellor his fiscal wiggle room appears “rather pale by comparison” to that of his predecessors, noting that “the headroom he set aside to reach those targets is the second-lowest headroom that any Chancellor has had when setting fiscal rules.” Meanwhile, OBR board member Charlie Bean told MPs growth in household incomes, after taking inflation into account, is set stall over the next two years, with households likely to remain worse off than before the pandemic until 2023.

Why should you become a CPA member!

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers.

Unlike other credit management companies, we charge our members a fixed annual subscription irrespective of how high the debt value is!

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Get compensated for previous late payments

Have you been paid late by business customers in the last six years?

Maybe you no longer work with them. Under legislation, you are entitled to  compensation you for those late payments you have suffered.

You put up with the PAIN – now claim the GAIN!

Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!

CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients

Check our compensation calculator to see how much your business could be owed!

Discover NOW the potential value of late payment compensation hidden in your sales ledger!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.