An increase in late payments is pushing many UK small businesses close to the edge, as energy bills and wages soar and sales fall.
The challenging economic conditions the country is experiencing due to rising inflation, has caused a significant crash, the biggest slump since April 2020 when the pandemic began, as reported by Xero’s Small Business Index.
Small businesses had to wait an average of 29.9 days to be paid in April, with late payment times rising by 1.8 days on average to 7.7 days.
Managing Director of Xero; Alex von Schirmeister, commented “This is a warning sign of what’s to come. Small firms are being hammered by a slowdown in consumer spending and a slowdown in getting paid what they are owed. Small businesses are being forced to a cliff edge by large firms who hold on to suppliers’ money”. He called for the Government to offer appropriate incentives for large businesses to pay their suppliers on time and enforce stricter penalties for paying late.
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