Comment: Chasing invoices is costing the economy
The Government's Small Business Commissioner is Shropshire-born Emma Jones. Here, she explains why tackling the late payments crisis facing small businesses across the country is her number one priority.
There's a real payments crisis facing small businesses across this country. Did you know that, on average, small business owners spend 86 hours every year chasing invoices which they haven't been paid for?
That's a staggering 133 million hours of staff time lost across the country every year. Time which could be much better spent running the 5.5 million small businesses which are the backbone of this country's economy.
Research carried out for my office and the Department for Business and Trade shows that 14,000 businesses close each year because of late payments while the issue costs our economy almost £11 billion every year.
Those figures are simply shocking and the reason I have made the issue my top priority as Small Business Commissioner. Having done it myself, I know the commitment it takes to start and grow a successful business.
I was born and bred into an entrepreneurial family of do-ers in Shropshire and was schooled locally at Newport Junior, Shrewsbury High School and Concord College, before leaving the county for university and to embark on a career.
After graduating in law and Japanese, I worked for professional services firm Arthur Andersen before starting a dot com business that was sold within two years and then launching Enterprise Nation which I built over two decades before selling the business in 2023.
I've also done stints running a national enterprise campaign, StartUp Britain, and working on procurement as SME Crown Rep. I became a public servant, in the form of the Small Business Commissioner, in June so I have the scars and the proverbial T-shirt when it comes to knowing a thing or two about the challenges facing small businesses.
That's why it's so important that in this role I do anything I can to make it easier for them by leveraging technology to speed up payments and to access support.
Late payment costs time and money and we want to reduce the time small business owners spend chasing debt so those hours can be spent on building sales and confidence which in turn builds resilience.
So, what are we doing?
We have a casework team that small businesses can call if they are not getting paid by a large business (with our definition of large being a company with 50+ employees).
Our team investigates and helps resolve disputes between small customers and larger customers, offers advice and support on key issues such as getting contracts right, managing invoices and understanding payment terms and can signpost businesses to other relevant support services where appropriate.
It's a free, impartial service which has recovered over £1.4 million of unpaid payments so far this financial year.In fact, we recovered almost £500,000 of debt in December alone.
Since the office was established in 2017, we have helped retrieve more than £10million of unpaid debt to small firms.
We also operate the Fair Payment Code for the Department of Business & Trade that showcases businesses who are paying on time and we are doing a lot of work to boost digital adoption in view of the benefits it delivers when it comes to making sales, getting paid and generally being more efficient.
It is vital we build resilience across all our small businesses. They have been bashed and battered over the past few years by a whole host of issues.
Prompt payment is just one factor in helping build that resilience.
They should also seek to embrace digital tools and tech.Smart adoption can boost operational strength and ensure you are safe.
It's a good idea to access free training on this topic such as Google Digital Garage events, British Chambers AI Academy and Enterprise Nation's Tech Hub. It's also essential for businesses to explore support programmes delivered in your area.
The Marches Growth Hub is a great place to start in Shropshire.
Nationally, programmes such as Help to Grow Management are invaluable and there is lots of cyber advice and support on hand from the likes of the Intellectual Property Office.
And if you want one piece of advice I would say this: take action and get support.
Emma Jones CBE is the Small Business Commissioner at UK Government's Department for Business and Trade
