Managing cashflow is key to business survival and it’s now critical that small suppliers get paid within 30 days, says OSBC
The Office of the Small Business Commissioner (OSBC) welcomes the clarity provided by yesterday’s report from the Federation of Small Businesses (FSB) on payment problems faced by small businesses. The current economic situation is causing increasingly difficult challenges for small businesses. Many are having to choose between paying their bills, in order to keep operating, and paying their own suppliers. Some may have further concerns, linked to Covid-19 staffing or trading relationships with the EU, creating additional barriers to success.
The best way to make sure these businesses survive 2022 is to pay for their products and services as quickly as possible, and certainly within 30 days. If it has been agreed that payment will arrive on a certain day, it is critical for small businesses that the money arrives on that date. Managing cashflow is key to survival, and that means certainty as to when payments will be received.
The FSB has found that 30% of the firms in their survey are struggling to get paid. This is a challenging situation that is likely to get worse. The OSBC stands ready to help those firms. Our caseworkers can help resolve payment disputes between small firms and their bigger customers. Given the economic situation it is more important than ever to us to apply our expertise to helping as many small businesses as possible.
Notes to Editors:
The Office of the Small Business Commissioner (OSBC) was set up by government at the end of 2017. Following growing concern about the amount of money owed to small businesses (those with fewer than 50 staff) by large business customers (businesses with more than 50 staff), the establishment of the OSBC saw steps taken to try to reduce this kind of business-to-business debt.
Established under the Enterprise Act 2016, the OSBC has the task of helping small business owners throughout the UK deal with the impact and possible consequences of poor payment practices. Some of the areas that the casework team grapple with on a day-to-day basis include overdue invoices and delays to payments, the imposition of unreasonably long contract terms and sudden changes to payment arrangements resulting from wider commercial challenges.
Through the provision of free information and advice, and a programme of lobbying and influencing large business stakeholders, the OSBC works to keep payment issues at the forefront of UK business discussions.
Currently, the powers that the Small Business Commissioner and their team have access to are focused on helping to manage disputes between small business suppliers and larger business customers. The OSBC can work as an informal mediator between parties in a dispute, as well as offering information about other kinds of financial and legal help. Not all these services are directly linked to government: the OSBC can help small businesses make connections with local and third-sector agencies as well.
The OSBC team of expert caseworkers can provide:
- general advice and information about resolving payment disputes
- a signposting service to further support, and to dispute resolution services through the OSBC’s own website
- a complaints investigation service focused on incidences of poor payment practice between small businesses (those with 50 or fewer staff) and their larger business customers (those with more than 50 staff).
The OSBC has the power to make recommendations relating to these complaints and help with dispute resolution. The OSBC’s services are completely free to use, and investigations will be treated anonymously if requested.