It is widely accepted that cashflow is the lifeblood of any business. But when you consider that fewer than 43% of new businesses in the UK last five years and an estimated 50,000 businesses fail every year due to cashflow issues, it really puts this into perspective.
A recent poll conducted by Pay.UK of 355 companies, revealed that 78% of small to medium sized businesses, are being forced to wait longer than their agreed terms by a month or more. Additionally, this research highlighted that UK SME late payment debt, has risen from the £13bn owed in 2018, to £23.4bn.
As small businesses account for almost 50% of the UK’s Gross Domestic Product and employ 60% of the population – with 12% admitting to having difficulties paying staff on time – it’s fair to say that when small businesses suffer, so does the economy as a whole.
Given that research published by Close Brothers, identified seasonal trends in late payments, with 18.7% of businesses saying they received more late payments in spring; what can businesses do to attempt to reduce what can only be described as a late payment crisis?
A multichannel approach to commercial debt recovery
By utilising Esendex’s Mobile Collection solution, your company can increase their debt collection success rate from the average of 20%, to 38.2%. Perhaps more importantly however, this can be achieved whilst maintaining good client relationships.
By taking into consideration the customers age, age of debt and amount of debt, our system will identify a likely preferred communication method from email, SMS and voice. This ensures your business has the best chance of successful debt recovery, exemplified by the fact that it helped npower increase final debt payment by 15%.
What’s more, with our multichannel collection solution, Cash4Now were able to reduce the cost of debt recovery to just 1.3% of the total debt recovered.