Small firms are still being caught out because they offer longer credit periods to customers than they receive from their suppliers, said a new report by the Credit Management Research Centre (CMRC).
On average, the companies responding to the poll had payment deadlines 12 days more generous than the companies they buy from. Professor Nick Wilson of the CMRC said: "Good credit management practices and procedures are proven to reduce the incidence of late payment and it is more important than ever that this message is acted upon."
The survey was of more than 1,300 small businesses. The new study also shows almost twice as many businesses, 44 per cent, have a formal credit policy than in 1996.
