10% of business people would still pay late even if they were paid on time
A web poll conducted on this Better Payment Practice Group (BPPG) website, during August revealed that 10% of business people would still pay late even if all of their customers paid them on time.

The survey of just over 800 respondents highlights a minority of business people who believe that it is justifiable to pay late even though their own cash flow is not compromised by late paying customers.

The research reinforces the need for businesses to make full use of sources of background information available on potential customers BEFORE they commence trading with them in order to minimise the risk of late payment.

The BPPG checklist of recommended information sources is as follows:

• Credit Reference Agency reports;
• Trade references;
• Company Accounts;
• Register of County Court Judgments;
• Insolvency Service;
• Bank references;
• Local intelligence (e.g. local newspapers, local business networking groups).

Roy Ayliffe, BPPG member representing the Chartered Institute of Purchasing and Supply, commented: “The cost of undertaking diligent background checks on potential customers is relatively small compared with the potential exposure to late payment and possibly bad debt. Forewarned is forearmed and if there is evidence of the possibility of late payment, preventative measures, such as limiting the availability of trade credit, will reduce your company’s exposure to risk.”

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