Late payments have ballooned in the first half of 2010 compared with last year, according to the latest figures from Lovetts.
The debt recovery law firm revealed that late payment demands (LPDs) have shot up by 24.6 per cent in the first half of the year compared with 2009.
However, the figures also show that late payers are now being given almost a month (29 days) to pay up before legal action is taken to recover the money.
Charles Wilson, managing director of Lovetts, said: “While we would expect to see a lengthening of payment times following one of the worst recessions in recent times, we would encourage all suppliers to keep their eye firmly on the ball when dealing with their customers.
“Just one large outstanding payment could have a serious impact on cash flow, the knock-on effect causing long-term damage to the reputation with its own suppliers as well as on its credit status,” he said.
“The beginning of 2010 brought with it the news that the recession is officially over and businesses are of course anxious not to damage customer relationships. Whilst they are happy to issue an LPD when required, we would encourage businesses not to become over-lenient about enforcing their payment terms.
“With concerns over a double-dip recession, businesses need to bite the bullet and get tough on late payers. A customer that does not pay for goods or services is no longer a customer, they are a liability,” he said.
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