Partner Article

Lovetts Welcomes Tesco Move to Cut Payment Terms to 14 Days

www.Lovetts.co.uk

Following the announcement by Tesco that it plans to cut its payment terms to 14 days, for suppliers that are small businesses, Lovetts, the commercial debt recovery legal firm is warning SMEs not to become complacent in the pursuit of overdue invoices, in the hope that other businesses will simply follow suit. Instead, Lovetts is urging SMEs to use the Tesco initiative as a signal that a more robust approach to late payment may win them respect rather than lose custom as many SMEs fear.

According to Lovetts’ figures, firms spent an average of 99 days waiting for an invoice to be paid, in Q3 2015, before instructing their solicitor to issue a Letter Before Action (LBA), threatening legal action.

Charles Wilson, Chairman of Lovetts says, “There is a real fear that by chasing late payment, SMEs risk damaging the client relationship. In our experience this fear is unfounded. The trouble is that companies capitalise on this fear, so it’s encouraging to see Tesco make some steps towards addressing the issue, albeit not until June 2016.

“We urge businesses to act early on late payments. Lovetts clients are using LBAs to take control of late payments and 84% of companies pay, when faced with the threat of legal action. An LBA is not a barrier to trading – as long as there is good communication between supplier and customer and clear contract terms, the customer will be under no illusion that it will be more expensive if payment is delayed. In over 8 out of 10 cases, a simple warning of legal action is enough and can cost businesses less than a cup of coffee.”

Charles Wilson

Ends

October 2015

Notes to Editors

Lovetts Ltd is one of the UK’s leading law firms whose sole line of business is the recovery of overdue debts and any commercial litigation resulting from debtor/creditor agreements.

Through this specialism and over 20 years in the debt collection industry, Lovetts has developed industry leading software for the efficient management and prompt recovery of debts, both in the UK and overseas.

For further press information please contact Alison Reeson or Cecile Stearn at HSL on 0208 977 9132 or email lovettsteam@harrisonsadler.com

Cecile Stearn HSL | Senior Account Director

Telephone: 020 8977 9132 Address: Churcham House|1 Bridgeman Road|Teddington|TW11 9AJ Website: www.harrisonsadler.com

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This was posted in Bdaily's Members' News section by Charles Wilson .