SMEs suffer double business blow

3 August 2005
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04 August 2005 | Rebecca Ellinor

Small businesses are hit hard by anti-competitive business practices and late payment, according to two recent surveys.

An Office of Fair Trading (OFT) study showed nearly a quarter of small and medium-sized enterprises (SMEs) believe they have been a victim of anti-competitive practices.

However, only a minority would report it to the OFT or other bodies.

The Forum of Private Business (FPB), a lobby group for SMEs, said unless firms can complain anonymously, they will suffer in silence for fear of retribution.

And in a separate study, SMEs were found to be hit hardest by the late settlement of bills.

The UK payment index, by credit management service firm Intrum Justitia, revealed the main reason for late payment was companies' own customers settling invoices late, leaving them with little capital to pay their own suppliers.

This means they can only pay those that can't wait. The report said this left suppliers providing non-critical services, or those not in a strong commercial position, joining the back of the payment queue or even, in some cases, going out of business.

The study found payment was, on average, 17.4 days late. The time taken by British companies to pay has fallen slightly from 52.1 days in 2003 to 51.3 days in 2004.

SMaug2005

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