Irish courts are experiencing sharp spike in the number of cases linked to international debt collection. A recent flurry of media coverage has brought attention to the operations of so-called ‘vulture funds’ as they apparently step up debt recovery in Ireland.
Vulture funds are financial organisations such as investment trusts, private equity firms and hedge funds which look for opportunities to make a profit from debt collection. They buy up debts at a discounted rate from organisations which no longer wish to be liable for them and then seek to recover more than they paid.
The scourge of unpaid invoices threatening the survival of small and medium sized businesses is an international problem. In Australia, things have got so bad that some companies are turning to desperate debt collection methods to try to recover money owed to them.
As a new report revealed that the average Australian business is typically owed £23,000 in outstanding invoices, one industry spokesman suggested hard pressed firms are ready to return to an old and infamous solution - biker gangs.
When Tesco was exposed for its long payment delays, it exposed an ugly trend among large businesses: delay, delay and delay some more, until your supplier is on its knees. And while the supermarket provided an extreme example of this unethical practice, a shockingly large percentage of global businesses see late payment to suppliers as a “fact of life”.
When you sign up a new customer or client, it’s tempting to skip the formalities. New customers are always keen and it seems like nothing can go wrong. The last thing you want to do is sour the relationship, or risk losing a client to a competitor. If you ask for a deposit, are you at risk of scaring them away?
In truth, most businesses are used to paying deposits especially if they are dealing with freelancers or micro businesses, and there are plenty of good reasons that you should ask for one.
Where do small businesses turn for help when they suffer due to late payment? Under new government plans, there could soon be a Small Business Conciliation Service tasked with tackling that precise problem.
That's not its official name as yet - and in fact, you could be forgiven for thinking you already know of a 'conciliation service' for small business disputes, in the form of mediation.
This Saturday December 6th is Small Business Saturday, an annual initiative to support small businesses throughout the UK, and it's not just about visiting your local independent gift shop.
Much of the focus will be on the nation's high streets and town centres, where free parking and special offers will encourage many people to finish off their Christmas shopping at small independent retailers.
The payment practices of the UK's biggest companies have been under scrutiny for a while now, with voluntary efforts such as the Prompt Payment Code attracting criticism for being 'toothless' in terms of enforcement action.
Meanwhile though, nobody really wants to see a situation where it is mandatory to take late payers to court, or to enforce penalties and interest - after all, sometimes you might simply want to extend the deadline as a gesture of good faith to a valued customer.
We all know healthy cash flow is the life blood of any small business, but when your cash flow is interrupted, survival depends on having funds in reserve - and the same is true of your customers.
So it helps to know how many small businesses out there have savings set aside 'for a rainy day', and how many would be unable to pay you if their own income was interrupted.
The figures don't make for encouraging reading - according to a report from British personal and commercial banking providers Aldermore, fewer than one in three businesses have a savings account at all.
Of those that do, 21% have less than £5,000 saved, and 7% have nothing at all.
Safe Collections is proud to announce that we are now the official Debt Recovery partner of Halton Chamber of Commerce & Industry.
A publicly accessible database of company directorships could soon become a reality, following the conclusion of a consultation by the Department for Business, Innovation and Skills.
The proposals outline plans for a central registry of company beneficial ownership information - including details of trustees, where relevant, and of individuals with ownership of more than 25% of the shares in a company, or the equivalent proportion of its voting rights.