Menu
14/02/2006
Rise in failure rate for small firms
A leading business pressure group is warning small firms to improve their credit checking procedures or face potentially devastating consequences after the number of business failures across various market sectors increased in 2005.
The Forum of Private Business (FPB), which represents 25,000 small firms, issued the warning in light of figures produced by credit reference agency Equifax and Close Credit Management. Equifax found that the retail sector suffered the greatest increase in failures, rising 25 per cent compared with 2004. Meanwhile the hotel and catering sector tied with construction for second place - with both recording increases in failures of 19 per cent year on year. The transport and communications sector reported an increase in failures of 11 per cent and manufacturing saw failure rise seven per cent.
Estimates from Close Credit Management (CCM) suggest that 15,000 small firms will fail this year, with cash flow being the main driver of failure. Other figures from CCM show that small firms are failing to recover around £50bn a month in outstanding debts.
The FPB's Chief Executive Nick Goulding said the scourge of late payment is still crippling small businesses. "We urge bosses to take stock of these facts and ensure they have rigorous credit checking processes in place," he said. "This means thorough management including credit checks on new customers and even existing customers, offering incentives such as discounts for prompt payment, making customers very aware of their payment with prompt invoices. Beyond that it is worth outsourcing collections, buying a credit insurance policy and constantly looking around for new business rather than relying on one or two clients."
(CL)
The Forum of Private Business (FPB), which represents 25,000 small firms, issued the warning in light of figures produced by credit reference agency Equifax and Close Credit Management. Equifax found that the retail sector suffered the greatest increase in failures, rising 25 per cent compared with 2004. Meanwhile the hotel and catering sector tied with construction for second place - with both recording increases in failures of 19 per cent year on year. The transport and communications sector reported an increase in failures of 11 per cent and manufacturing saw failure rise seven per cent.
Estimates from Close Credit Management (CCM) suggest that 15,000 small firms will fail this year, with cash flow being the main driver of failure. Other figures from CCM show that small firms are failing to recover around £50bn a month in outstanding debts.
The FPB's Chief Executive Nick Goulding said the scourge of late payment is still crippling small businesses. "We urge bosses to take stock of these facts and ensure they have rigorous credit checking processes in place," he said. "This means thorough management including credit checks on new customers and even existing customers, offering incentives such as discounts for prompt payment, making customers very aware of their payment with prompt invoices. Beyond that it is worth outsourcing collections, buying a credit insurance policy and constantly looking around for new business rather than relying on one or two clients."
(CL)
Related Northern Ireland Business News Stories
Click here for the latest headlines.
08 November 2018
Public Urged To Support Small Businesses
The Lord Mayor welcomed the Small Business Saturday campaign bus to Belfast on Friday, 02 November, in the run up to 'Small Business Saturday' on 01 December. Councillor Deirdre Hargey joined the Federation of Small Businesses (FSB) and others to support the grassroots campaign which encourages people to support small businesses and shop local.
Public Urged To Support Small Businesses
The Lord Mayor welcomed the Small Business Saturday campaign bus to Belfast on Friday, 02 November, in the run up to 'Small Business Saturday' on 01 December. Councillor Deirdre Hargey joined the Federation of Small Businesses (FSB) and others to support the grassroots campaign which encourages people to support small businesses and shop local.
16 October 2018
Entries Open For FSB Celebrating Small Business Awards
The Federation of Small Businesses (FSB) has announced that entries are now open for the Celebrating Small Business Awards, showcasing the best small businesses from across the UK including local awards for Northern Ireland The FSB Awards recognise the best small businesses and the self-employed from right across the UK, from every sector and indus
Entries Open For FSB Celebrating Small Business Awards
The Federation of Small Businesses (FSB) has announced that entries are now open for the Celebrating Small Business Awards, showcasing the best small businesses from across the UK including local awards for Northern Ireland The FSB Awards recognise the best small businesses and the self-employed from right across the UK, from every sector and indus
20 September 2017
Council Launches New Small Business Support Programme
Belfast City Council has launched a new supportive programme for Belfast based micro, small businesses and social enterprises, called 'Think.Do.Be.'.
Council Launches New Small Business Support Programme
Belfast City Council has launched a new supportive programme for Belfast based micro, small businesses and social enterprises, called 'Think.Do.Be.'.
07 December 2017
NI Business Owner Visits 10 Downing Street
A business owner from Northern Ireland has just returned from her visit to 10 Downing Street as part of this year's Small Business Saturday Top 100.
NI Business Owner Visits 10 Downing Street
A business owner from Northern Ireland has just returned from her visit to 10 Downing Street as part of this year's Small Business Saturday Top 100.
03 December 2015
Local Firms To Host Events To Mark Small Business Saturday
Many local business associations are holding events this weekend to mark Small Business Saturday, supported by Belfast City Council.
Local Firms To Host Events To Mark Small Business Saturday
Many local business associations are holding events this weekend to mark Small Business Saturday, supported by Belfast City Council.
-
Northern Ireland WeatherThis Evening and Tonight:A dry night, save for a few light showers around the coasts, with prolonged clear spells and light winds bringing a frosty dawn for many in central and southern parts. Minimum temperature -3 °C.
