Slow-paying clients pose serious risk to micro-businesses

Slow-paying clients are a serious risk to micro-business owners, so says cloud accounting company FreeAgent.

In a poll carried out by YouGov on behalf of FreeAgent, one in eight micro-business owners have had to wait a year or more to get paid by one of their clients.

13 per cent of micro-business owners surveyed said they had to wait at least a year before a client had settled an invoice.

46 per cent of business owners also revealed that they had to wait two months or more to be paid.

FreeAgent surveyed more than 500 businesses, which was carried out to celebrate the company’s £1 million crowdfunding drive through Seedrs.

In contrast, 14 per cent said they had never been paid late, while 85 per cent of businesses that issued an invoice said they had also never been paid late.

Ed Molyneux, CEO and co-founder of FreeAgent, said: “When you’re running a business it’s really important to get paid quickly – late-paying clients can create major cash flow problems which in extreme cases can lead to the failure of your business.

“So instead of worrying about having that awkward conversation with a client, make sure you chase your overdue invoices quickly.

“Either make chasing invoices a strategic part of your weekly accounting or invest in the right tools or software that will do it automatically for you.”

Image source: Shutterstock

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