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Tardiness tars the name
Page 30
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Late paying companies risk ruining their reputation; 85% of UK firms believe that late payment is unethical, according to a survey by the Better Payment Practice Group (BPPG).
BPPG warns that the practice of deliberately paying later than agreed terms can also be detrimental for other economic reasons, such as losing of valid customers. It could also indicate that a business may be in financial difficulty, which can see suppliers offering less attractive credit terms, and weakens the economy as a whole by restricting growth.
Peter Rowe, director general of the Institute of Credit Management and BPPG member, says the BPPG would like all firms to be responsible about paying suppliers on time: This is crucial if the UK's payment culture is going to continue improving. Businesses need to remember that prompt payment can be as beneficial to them as it is to their suppliers.
"The way businesses manage their purchasing and sales relationships can have a direct effect on their profit margins; a commitment to prompt payment can result in more cooperative partnerships and a better service from suppliers, with more attractive credit terms."