Here at Commercial Domestic Investigations, we understand that late payments are a key concern for UK small business owners. An unpaid invoice can deprive small companies of the vital cash flow needed to fund operations, making it harder to do business. Around half of UK freelancers, a new survey has found, have actually considered quitting the freelance lifestyle because of late payments.
Serious issue for freelancers
This study was conducted by small business insights firm Ormsby Street. Business portal Start-ups writes that Ormsby Street recently surveyed 1,002 freelancers and sole traders. They found that on average, British are owed £5431 in late payments. Almost half (46%) of freelancers and sole traders questioned admitted that late payments force them to struggle to find enough money to live on.
Dealing with late payments
Ormsby Street also asked respondents how they supplement business revenue when clients pay invoices late. Over a third of those questioned (36%) have had to resort to payday loans to supplement cash flow, while a similar number (37%) have sought immediate finance from friends and family.
The survey further found that on average, freelancer invoices are paid 18 and a half days after their due date. Just shy of one in ten (19%) of respondents said that the majority of their invoices are always paid by their due dates. The majority (57%) of those questioned by Ormsby Street admitted that they hold concerns that if they chase payments, clients may not utilise their services again.
Advice for freelancers
Commenting on these findings, Ormsby Street Managing Director Martin Campbell said: “Why should a freelancer waste their own billable hours chasing payment for work that has been successfully completed and is already due for payment?”
Continuing, Ormsby Street’s Managing Director said: “If customers are not willing to pay within the agreed terms then it’s time for freelancers to become more informed over whom they work with, and either ask for payment upfront or even choose to not work with company.”
About Commercial Domestic Investigations
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.