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The number of outstanding invoices owed to businesses based in the North West has increased again in May, according to analysis from R3.
Analysing data provided by Creditsafe, R3 found that the number of invoices past the payment deadline on North West company books grew from 748,600 in March to 772,200 in May.
This 3% increase in outstanding invoices could spell trouble for firms in the region.
Tom Fox, Licensed Insolvency Practitioner at Umbrella Insolvency said: “The odd unpaid invoice may just be an inconvenience for some firms.
“But it can leave other firms extremely vulnerable. If a significant invoice goes unpaid, or multiple customers don’t pay on time, it can threaten a company’s ability to pay their employees, suppliers and vendors.”
There are some signs that companies are finding it harder to pay their bills.
The same R3 research found that the number of companies in the North West who themselves had overdue bills has also increased, from 59,000 in March to 59,500 in May.
Overdue bills can be a clear sign of business distress, but R3 found the the number of business insolvency activities in the North West actually declined from a peak of 815 in March to 285 in May.
R3’s North West chair, Allan Cadman, said: “Rising costs and interest rates are the latest in a long line of economic shocks facing UK businesses and not surprisingly, some are delaying paying their bills as they attempt to ride out the current economic turbulence.
“But having problems paying suppliers is a key indicator a business is financially distressed.”
Six tips to get your invoices paid on time
When suppliers pay their invoices is often out of your hands, but there are some things you can do to give yourself the best chance of getting paid on time.
- Send your invoices to the right person within a company. This won’t always be the person that commissioned you.
- Keep your invoice template simple, but make sure you include everything you need to get paid on time.
- Find out early if you need a purchase order number. This can often cause delays when it comes to getting paid.
- Submit an invoice as soon as possible after work is completed.
- Clearly set out what each charge on your invoice relates to.
- Call before invoices become due to check they have everything they need.
Is your business struggling with financial hardship? Speak to one of our advisers for free, confidential advice. Call Umbrella.UK Insolvency: 0800 611 8888.