Firms should 'use efficient invoicing'

Businesses need to make sure they have a "clear and efficient invoicing process" to avoid late invoicing and money losses, it has been claimed.

Late payments more than 120 days in arrears have caused UK businesses to have a deficit in invoices of around £15.7 billion and smaller firms have been most affected by this, according to NatWest bank.

Steve Hughes, economist at the British Chambers of Commerce, said that businesses need to improve their invoicing so they have "clear and agreed terms of payment with those they supply".

Many typical payment issues still exist despite current conditions being better than they were during the recession, he said.

"The credit crunch exacerbated and laid bare the problems that can be experienced up and down supply chains as a result of longer payment times," added Mr Hughes.

Nearly three-quarters of small and medium-sized enterprises have been affected by late payments but less than half of them have actually taken steps to combat the problem.

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