Slow payments 'hitting businesses'
Aug 29 2008
Quick billing from suppliers and fewer companies adhering to agreed payment terms is causing problems for small firms, research finds.
In response to its research, HSBC Commercial Banking is encouraging small companies to review their finances to ensure they are managing them in the best way possible.
Some 18 per cent of businesses surveyed claim that suppliers are requesting bills be paid more quickly and one in five - 20 per cent - say agreed payment terms are being followed less stringently.
The bank claims many small firms are too reliant on their savings and overdrafts to pay for large purchases or investments.
Noel Quinn, HSBC's head of commercial finance for Europe, believes there are more appropriate solutions to these issues for smaller companies.
'We are urging businesses to talk to their trusted advisers to ensure they have the right financial tools in place for the current environment,' he says.
The survey comes in response to research from the Federation of Small Businesses which found large firms are squeezing smaller ones by delaying payments.
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