Construction companies withhold £1 billion in payments to suppliers. That's according to the National Specialist Construction Council (NSCC) which calculates that the amount of money owing to suppliers by construction companies is now 50% more than two years ago.
Just 15 percent of the NSCC's members are paid within 30 days of completing a job. The average is about 60 days while Carillion Plc, averages 86 days.
At a time when managing cashflow is more important than ever, small and medium sized businesses often find themselves at a disadvantage when owed money by larger companies.
The sad fact is that suppliers who chase for payment themselves are likely to be ignored. If you want to put yourself at the head of the queue for payment, then it is important to have a good procedure for avoiding bad debts.
Steve Petty, Commercial Property Lawyer
This blog is not intended to constitute legal advice, nor is it intended to be a complete and authoritative statement of the law, and what we say might be out of date by the time you read it. You should always seek legal advice to confirm whether or how any information in this blog applies to your particular situation. We offer a free 30-minute telephone advice session to discuss your particular circumstances.