New payment reporting rules will improve customer/supplier relationships, expert claims
Press Release – 2 March 2017
A leading payment expert has refuted suggestions that new government financial reporting rules will increase the burden on big businesses, and says greater transparency will help improve customer/supplier relationships.
From next month, all big businesses will be obliged to post their payment records on a dedicated government website on how they treat suppliers, or face the risk of hefty fines for non-compliance. It will allow suppliers to compare and contrast the payment performance of customers within their own industries.
Speaking on the BBC’s You and Yours, Philip King, Chief Executive of the Chartered Institute of Credit Management (CICM), says that it’s data that all business should have to hand: “Most businesses will have this data in some form or another and should be monitoring how they are treating their supply chain anyway, because if they are not, then they’re not doing their job.”
He also said that given the publicity around late payment, there are not enough complaints being addressed to the CICM as administrators of the government’s Prompt Payment Code: “We only get three or four complaints a month on average, and it should be more than that as clearly there is plenty of noise around bad behaviour,” he explains.
“This is incredibly frustrating, for when we do get contacted, we are very successful at resolving queries, getting things changed within both supplier and buyer processes, and getting the money paid very quickly.”
Philip says that although small companies often fear raising a complaint, there is little or no evidence that in doing so there is any lasting damage to the customer/supplier relationship: “More often than not, a complaint revolves around an invoice that’s not been paid, and when you dig further, it’s very often an administrative issue, a process issue, or simple inefficiency on the part of the customer. In all such cases, our intervention allows the problem to be resolved quickly, and often it is the first time that there has been any dialogue between the two sides about the issue.”
Poor credit management practices, he says, are also often to blame: “Wrong purchase order numbers, or the invoice sent to the wrong address or the wrong company can all lead to an invoice not being paid. Not all businesses behave responsibly, that is certainly true, but there are many more who do want to support the supply chain and who do want to strengthen their supplier relationships.”
Philip believes that taking a professional credit management approach from the outset can make all the difference: “Suppliers sometimes don’t appreciate the strength of their position,” he continues. “Setting payment terms from the outset, and adopting best practice credit management, can make all the difference in getting paid on time.”
To listen to Philip’s interview, please click here and start listening from 28 mins 10 seconds.
For further press information, please contact:
Sean Feast, Alex Simmons or Tom Berger – Gravity Public Relations
0207 330 8810, email email@example.com
The Chartered Institute of Credit Management (CICM) is the largest recognised professional body in the world for the credit management community. Formed over 75 years ago, the Institute was granted its Royal Charter in 2014. Representing all areas of the credit and collections lifecycle, it is the trusted leader and expert in its field providing its members with support, resources, advice, and career development as well as a networking and interactive community. In addition to its comprehensive suite of qualifications and learning opportunities, events and magazine ‘Credit Management’, the CICM administers the Prompt Payment Code for BEIS. Independently, and through collaboration with business organisations, it provides vital advice to businesses of all sizes on how best to manage cashflow and credit.
Linkedin: CICM Credit Community