Start-ups face discrimination
Jun 14 2010
Start-ups are missing out on new business due to perceptions of being too ‘financially unstable’ to trade with.
Some 9 per cent of established companies say they avoid trading with businesses less than a year old, according to research from credit referencing company Creditsafe.
David Knowles, business development director at the firm, says: ‘There is a danger we could choke the fledging economic recovery if companies refuse to trade with start-ups purely on the basis that they are new companies. Businesses need to take sensible steps to accurately establish the financial health and creditworthiness of trading partners rather than relying on gut instinct and preconceptions.’
A further 51 per cent of respondents to Creditsafe's survey will not trade with a company that is only contactable via a mobile number, with 52 per cent refusing to do business with an enterprise if it only has a PO Box address. Of the 797 businesses surveyed, 12 per cent would not trade with a company without a website.
Adds Knowles: ‘People have the right to be cautious when a company gives a mobile phone number only and they should also remember that having a website in itself gives little indication of a company’s creditworthiness.’
According to Creditsafe, there were 364,000 start-ups launched last year.
There are currently no comments on this article
Comments