In some cases the very future of the small business is threatened. Paying late is bad business practice. Any business that pays late as a matter of course is effectively saying that it is acceptable to abuse the provision of trade credit and the good faith of its suppliers. It is saying that it doesn't value its suppliers and doesn't care enough about them to foster or maintain good relations. Those that pay late should realise that good supplier relations are key to the continued profitability of their own business.
Late payment can also add to the customer's costs.
Any supplier will have to recover their costs and, if they keep being paid late, this can mean increased prices. Business must understand that these increased costs to the supplier will be ultimately met by the customer. Action to tackle late payment can wait no longer. The Bill gives effect to the Government's commitment to introduce a statutory right for businesses to claim interest on the late payment of commercial debts. Over 5,300 copies of the Green Paper were sent out and more than 450 responses to the proposals received.