Credit managers urge Sir Alan to act promptly on late payment
11 June 2009
The Institute of Credit Management (ICM) is urging Sir Alan Sugar to join its campaign in improving the payment culture within big businesses and their treatment of smaller suppliers.
Sir Alan Sugar’s new remit as Enterprise Champion will include prompt payment and cash flow – building on the work the ICM has been doing in promoting the two issues with the launch of its Managing Cashflow Guides and Prompt Payment Code.
In December last year, the ICM developed the Prompt Payment Code (PPC), supported by major business organisations, which aims to establish a clear and consistent policy, and a climate of greater certainty in the payment of business to business invoices.
The Code built on a series of free ‘Managing Cashflow’ guides produced by the Government in association with the ICM in November 2008, available from www.creditmanagement.org.uk. One of the guides, ‘Treating suppliers fairly’ promotes the policy of paying invoices on time.
The Prompt Payment Code focuses on three main areas: a commitment to pay suppliers on time; to give clear guidance to suppliers; and to encourage good practice and is part of a campaign designed to help increase the speed of payments to smaller companies.
To date more than 200 companies have become signatories to the Code including Asda, Tesco, Shell, BAE Systems, Barclays plc, Sony UK, SKY and B&Q.
A recent poll by The Federation of Small Businesses (FSB) revealed that more than 70 per cent of FSB members thought a corporate mediator would help build better relations between banks and small businesses. Members believe Sir Alan Sugar can help to restore trust and confidence between small businesses and their lenders and ultimately kick start the economy.
This is a belief the Director General of the ICM, Philip King, shares: “Sir Alan Sugar’s appointment as Enterprise Champion with his impressive history and standing in the business world could be the catalyst the economy needs. There is no-one better placed to help kick start the flagging economy.
“When money is tight and cash flow critical, it may sound counter-intuitive to be encouraging buyers to part with their money more quickly. The advantages, however, go far deeper than simply being seen to treat your customers more fairly. There can be real financial benefits throughout the supply chain.”
The PPC is hosted by the ICM on a dedicated website (www.promptpaymentcode.org.uk) and includes a facility for suppliers to raise concerns about late payers.