Jewson joins the late payers
Published: 04 September, 2009
COVENTRY: Jewson has told some suppliers they will have to wait 60-days for bills to be paid and be charged a 10% fee for settlements made within the period.
Jewson is one of an increasing number of companies extending their payment terms at the expense of small companies, said the Federation of Small Businesses.
The federation called for action to "change the damaging culture of late payments" and has written to these companies to explain how badly late payment affects the cash-flow of small firms, particularly during this economic period, and is urging them to sign up to the government-backed Prompt Payment Code.
The most detailed insight into late-payment problems, produced by Barclays Bank earlier this year, showed that small and medium-sized businesses are owed more than £10bn by suppliers or customers failing to pay within the standard 30-day invoice period, an increase of £1.7bn on last year.
The FSB points to the 4000 business failures caused by late payments last year as an indication of the risks and says one in three of its members now waits longer to be paid than a year ago.
Thirty companies are on a name and shame list produced by the Forum of Private Business that has submitted Freedom of Information Act requests to every council and health trust asking how long they take to pay suppliers. The forum feels the Government's public sector code aimed at paying suppliers within 10 days is having little success outside Whitehall.