Commercial Domestic Investigations realise that when you are running a business, having a good cash flow is essential to growth and expansion. If your company falls victim to bad debtors it is difficult to continue to operate.
In analysis carried out by Direct Line for business, it was found that SMEs over Britain collectively wrote off £5.8bn of debt during the last financial year, equivalent to more than £21k per day.
The investigation found that 19% of SMEs had written off debts at an average company loss of £31,330. Not only that, but 9% of these SMEs had excused debts in excess of £100k.
When asked why they chose to forget about this debt, nearly a third of the SMEs (29%) said it was because the supplier was unable to pay due to liquidation whilst 17% said that they did not think the supplier would have sufficient funds to repay the debt. 11% admitted that they themselves didn’t have the funds to chase the debts legally and 10% didn’t want to destroy supplier/customer relationships by demanding overdue payments.
The head of Direct Line for Business, Nick Breton, said: “With more than a million SMEs based across the UK, these enterprises really do make up the backbone of the British economy.
“However, it is alarming to see just how much hard work goes unrewarded, especially when considering that many SMEs appear reluctant to chase debts, with reasons ranging from thinking that the client may not be able to afford the cost to damaging their relationship.”
He continued: “All of these debts add up and with nearly 7,000 companies estimated to have entered liquidation in the first half of 2016 alone, the potentially disastrous knock-on effects of writing off monies owed are clear.”
What Commercial Domestic Investigations can do for you
Commercial Domestic Investigations are regarded within the debt collection and credit control industry as one of the best credit management companies in the UK. Established in 1988 to support and service all sizes of companies in the field of Credit Management.
Commercial Domestic Investigations have recently featured in the press in The Guardian. To keep up to date with the latest debt collection news make sure to follow Commercial Domestic Investigations on twitter, LinkedIn and Google+.
We now boast a national client base in excess of 30,000 companies. Commercial Domestic Investigations has grown by listening to clients’ requirements and adapting our services to meet all companies’ needs from Sole Traders, SMES, Ltd and Plus. Please contact us on 08444 159200 for more information.