14 September 2009
Almost 80 per cent of UK engineering suppliers with international contracts are experiencing issues with late payment.
According to the annual 'state of business' report by the Association for Consultancy and Engineering (ACE), overseas buyers are trying to negotiate payment terms after work has been completed, and in some cases vendors have not been paid at all.
The report found: "Late payment has been the biggest single issue for ACE members working overseas. ACE would like to see the UK government work with its counterparts overseas to encourage good practice in the payment of bills."
It added that suppliers have also experienced incidences of 'pay when paid', meaning overseas companies are waiting until they have been paid to settle invoices with suppliers.
Senior executives at more than 150 of ACE's 800 member organisations were questioned in the survey released last week.
The study also highlighted difficulties faced by engineering suppliers with UK public procurement processes, including inadequate notice of opportunities, inappropriate terms and conditions and tender evaluations that focus more on price than quality.
It also noted that smaller suppliers are often excluded from bidding on projects as a result of a lack of experience or low turnover. ACE called for "concerted efforts" to help SMEs access public procurement opportunities.