Suppliers advised to claim due compensation for late payments

Latest figures from a comCalculator and penmercial debt recovery law firm has revealed the scale of debt UK businesses are dealing with due to late payments. Research also shows that suppliers are bank rolling their customers for an average of 103 days from when the invoice is issued to before they threaten legal action with a Letter Before Action (LBA).

This amount of days shows a 24% increase from 83 days when compared to Q1 in 2014 to Q1in 2015. As a result, many have argued that although high profile campaigns have increased to try and tackle this issue, late payments in the UK are only getting worse.

Although the business industry on the whole improves, it seems that many UK businesses are unwilling to ‘rock’ any existing client relationships by threatening legal actions. However it is likely that their invoices will simply fall to the bottom of an unpaid pile  and forgotten. Therefore it is essential for businesses to act early on overdue invoices. In order to fight late payers, businesses should claim their right to compensation. The Late Payment Act allows businesses who have been paid late  to claim interest for the period the debt was overdue, plus compensation.

Businesses are entitled to claim interest and compensation remains for 6 years on each and every invoice paid late, unless clear assent is proven against the claimant. Many businesses utilise the Late Payment Act in order to take on late payers, recovering significant sums to compensate them for the administrative and legal costs they have incurred chasing late payment.

If you are a business suffering from poor cash-flow and unpaid invoices Positive Collections can help you. Positive Collections provides a FREE online credit control system to help you streamline and manage your invoices more efficiently. Our debt recovery service is an effective 3 step solution to ensure that you receive any monies owed.

To find out more about how Positive Collections can help you simply visit us online at or call us on 0208 313 7887.


Government set to crackdown on late payments

New rules have been implemented to tackle late payments for public sector suppliers. These new rules for the public sector mean that both contractors and sub-contractors will have to be paid within 30 days. These tougher measures are as a result of late payments being one of the biggest problems for small businesses in the UK.

Late payments have proven to prohibit business growth and often cause many small businesses to close down. In a report from 2014, UK businesses faced up to £40bn in unpaid invoices which equates to an average of £38,186 per firm.

However, under new rules which are being implemented as of the 26th February 2015, the public sector will have to pay both contractors and sub-contractors within 30 days. In addition to this, the government has also revealed that public bodies will need to publish an annual late payment report. This push comes as the government warns that late payments which cause smaller firms to fall into financial crisis will no longer be tolerated.

The minister for business, enterprise and energy, Matthew Hancock has also suggested that this change is a way of “toughening up the voluntary Prompt Payment Code to make 30 days the standard term, with 60 days the maximum in all but ‘exceptional cases’…giving the body which runs the code ‘teeth’ including the potential to issue fines”.


What is the Prompt Payment Code?

With any business, prompt payment is critical for cash flow, especially for small businesses that fall within a supply chain. As a result, the Prompt Payment Code is a way of encouraging a good practice between both organisations and suppliers. Those who sign the code are committed to paying their suppliers within clearly defined terms and dealing with any issues which arise using the correct process. Therefore those who sign the code are to:

  • Pay suppliers on time
  • Give clear guidance to suppliers
  • Encourage good practice

With this in mind, Mr Hancock is expecting all major companies to sign up to the code. This comes with the intention to help speed up the process in which companies are paid.

If your business has fallen victim to late payers, Positive Collections can help you. Positive Collections provides a fast and affordable solution to recovering any outstanding invoices and debts you may have incurred. In just 3 simple steps and for as little as £4.99, we can help recover your business debts and help improve your cash flow. For further information and advice visit us online at or simply call us on 0208 313 7887.

Tips on managing your businesses cash flow

In the UK, around 25% of British businesses fail to financially plan ahead. Around 6% of companies rely on credit cards to manage fluctuations in cash flow, whilst 4% use business loans and approximately 17% use the method of either decreasing or increasing staff numbers to deal with the issue. In addition to this, figures also show that around 18% of businesses suffer a cash flow crisis at least once a month. However with effective cash flow planning and cash flow forecasting businesses will have more control over its finances. Getting clients to pay on time is perhaps one of the most effective way of preventing cash flows issues, although this is definitely easier said than done. If possible, Positive Collections would recommend negotiating a percentage which is payable upfront to minimise the impact of any eventual late payments.

Recurring issues involving payment delays can have a negative impact on your cash flow so it is often best to seek alternative finance solutions such as invoice factoring which enables businesses to unlock cash capital from unpaid invoices. If you are finding it difficult to stay on top of your businesses cash flow, visit to see how we can help you control your credit or recover any outstanding debts. Remember, most businesses fail from a lack of cash flow then from a lack of profit.

Here are some tips to help you manage your businesses cash flow:

PAYMENT TERMS: always ensure that your business has a formal collections policy set in place, so that clients can pay on time. Don’t be afraid to ask for payment and always make payment as easy as possible for your clients. When asking for payment it is advisable that you quote your bank account number on your invoices so there is no excuse for delays. Asking for direct credits or automated payments is also recommended to avoid delays and payment issues.

PLAN AHEAD: always work out when cash will be coming into your business and when it will be going out, so that the funds are already set up to make the necessary payments. By preparing cash flow forecasts throughout all the months/seasons of the year so that you know that your business will survive through its down periods. If you are struggling to predict your sales is recommended that you review all your outgoings first and then see how much you need to sell in order to cover your outgoings. The rest is then profit.

TIMESCALES: always keep track of how long it takes your clients to pay you. Remember the better your debtor days the great your cash flow.

CLIENT EXPECTATIONS: delivering a service or a product to high standard that meets your customers’ expectations is essential. Chasing payments for a job well done is much better then chasing payment for a poor service or product.

INVENTORY: always ensure that you have enough stock for trading, factoring in any changes in demand. Measuring your inventory turnover enables you to sell slow moving products, helping your business turn its stock into cash.

INVOICES: this is essentially the part where you get paid, although it can often be a struggle especially if your clients are also suffering from a poor cash flow. By setting up a invoice management system, you can not only improve your cash flow, you can also reduce paperwork whilst saving both money and time chasing payments.

At Positive Collections, we provide an effective online credit control system which is completely FREE. Our debt recovery service also enables us to chase any outstanding invoices/payments on your behalf for just a one-off fee of £4.99. To find out more simply visit or simply call us on 0208 313 7887.

Child receives invoice from school friend’s parent

After a classmates birthday party children are normally left with a party bag and a sugar high, Alex Nash however, was left with an invoice in his book bag. The five year old from Cornwall was handed the invoice for failing to attend a classmate’s birthday and now his parents face a battle in small claims court.

We all have busy schedules and we’re occasionally guilty of double booking ourselves and that includes five year olds. Alex’s parents accepted the invitation to attend his school friend’s birthday party at a local dry ski slope but also pencilled in a visit to the grandparents on the same day. After opting for time with the grandparents over attending the birthday party, Alex’s parents failed to inform the birthday boy’s parents.

Unfortunately birthday party places do not come cheap and Julie Lawrence, irritated mother of the school friend, was left paying £15.95 for the place of a no show.

Alex’s father Derek was gob smacked to find his son had been formally invoiced for failing to attend the party. Mr Nash said, “It was a proper invoice with full official details and even her bank details on it.”

pc invoice

However Mrs Lawrence says she is fully within her rights to invoice the Nash’s saying, “All details were on the party invite. They had every detail needed to contact me.”

After refusing to pay the invoice sum of £15.95 Mr Nash has found himself on the way to small claims court.

Are you owed money? Positive Collections can help recover any outstanding debt you may have. Whether someone personally owes you money, or you are a business that has experienced late payment, or maybe even a disgruntled parent chasing payment from party no shows, Positive Collections can help you. Our experienced debt recovery team will help recover what is rightfully yours. For more information about our debt recovery services please visit our website or call 0208 313 7887 today.

Thinking of improving your businesses finances? Here are some ways to do it!

Wancommercial-debt-recoveryt to know how you can streamline your company’s invoices, effectively manage your businesses cash flow and even set long-term financial goals? Well keep reading and you’ll find out!

As a small business owner there are always a handful of rules you should keep in mind when trying to improve your company’s financial processes. Firstly, it’s always good to speed up your invoicing process as not many companies can afford to let their bills go left unpaid for long periods of time. In order to get these invoices paid quicker it’s always best to take control so that you give clients a shorter time frame to pay. It is essential to make invoicing your clients as early as possible a routine. This will help to ensure that your debts are paid off in full at the earliest opportunity.

Always being clear about your company’s terms is an absolute must! Small businesses that begin to experience a rise in unpaid invoices early on will quickly see their debts mount up. By laying down the rules in the form of terms and conditions, clients will have to make an agreement before using your services. These terms are essential as they help to ensure that all relevant parties involved adhere to your payment terms well in advance. So there is no excuse to have invoices left unpaid.

Got lots of cash coming in? You might need to make a plan for that. In reality, most small businesses that see cash coming in or even piling up will need to streamline their finances in order to use it effectively. The best practice for this would be to relocate the funds brought in to creditors, service providers and even employees for example. It is always best to plan exactly where your money is going once it is received.

Setting both business and financial goals is also a must! By stipulating clear goals for your business from the outset you can track exactly where your business is financially. By splitting your financial year into quarters, you can breakdown your company’s finances into more manageable figures. By doing this, it will help to focus and contextualise any progress made in your business.

Using your strengths to improve your businesses finances is also essential. Small businesses should always be looking to find ways to grow and maintain their sustainability. Keeping your business alive and growing should be your key focus and strength. See where your business is delivering on profit and where things are costing you. By distinguishing between the two, you can then find the best route forward. In more simple terms, find out what makes your company the most money and improve on it. And once you have discovered what costs your company money, find a way to remove it or make it more cost effective.

As a small business, money can sometimes be tight and leave no room to make improvements of even expand. However, it is essential you do not borrow more money than you need. In order to stay on the straight and narrow it is always best to do your homework and find the best source of funding which best suits your company’s needs. Finding the right type of funding is vital to small businesses especially in the early stages. Yet borrowing too much money can result in an unwanted burden.

If you’re looking to make your business debt free or to get paid for any outstanding invoices then contact us at Positive Collections today! At Positive Collections we also offer a completely free credit control system which allows you to manage your businesses money and improve cash flow. For further information on how we can assist you and your business visit us online today or simply call us on 0208 313 7887.