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Why invoice delays are more than an irritation - they are a growth killer
From 30 days to 60 days and beyond: the growing payment crisis facing UK SMEs
Scroll through LinkedIn for five minutes and you’ll spot it, another subcontractor posting about waiting to be paid, a small business owner posting about chasing invoices weeks overdue, a tradesperson sharing payment terms that have quietly crept from 30 days to 45, 60 or worse.
This isn’t a distant observation for me unfortunately. With several small business owners and tradespeople in my immediate family, I’ve seen first-hand just how disruptive and disheartening late payments can be.
These aren’t isolated grumbles either. This is a systemic issue. And while delayed payment has always been a thorn in the side of small businesses, it’s now becoming something far more dangerous: a barrier to survival, a cap on growth and for some, a slow death by admin.
The reality on the ground
According to recent figures, two-thirds of small business invoices in the UK are paid late. Around 90% of companies report experiencing delayed payments from clients. In sectors like construction, maintenance and transport, the norm is no longer "Net 30" it's appears to be "Net When We Feel Like It."
One UK subcontractor, recently shared that they had to pull their team off-site because none of their invoices had been settled. Others describe the psychological toll: the weekly balancing act between paying staff, covering fuel and still not knowing when the money owed will arrive.
It’s more than frustrating. It’s unsustainable.
Why this keeps happening
At the heart of this crisis is a power imbalance. Larger companies, with deeper pockets and more leverage, often extend payment terms to improve their own cash flow, pushing the burden down the supply chain. For small businesses, these delays aren’t just inconvenient. They’re devastating.
There’s also a cultural element. In some industries, late payments have become normalised. It’s just “part of doing business.” A problem to be tolerated, not solved. And because many SMEs don’t have the time or legal muscle to chase what they’re owed, the problem persists.
The hidden costs of late payment
We often talk about cash flow in technical terms, but let’s get real: this is about people.
When payments are delayed:
- Business owners dip into personal savings or other areas to cover payroll.
- Growth plans are shelved. That new van? The extra apprentice? Not this quarter.
- Staff morale takes a hit as uncertainty creeps in.
- Relationships with suppliers get strained.
Every unpaid invoice is a decision deferred. A cost carried. A risk absorbed.
One business shared with me that they spend over 20 hours a month just chasing overdue invoices. That’s half a working week gone. Not spent on strategy. Not spent on delivery. Just chasing money already earned.
It’s a growth killer, not just a headache
The most damaging myth around late payment is that it’s just a nuisance. Something you can grit your teeth through. But late payments actively prevent growth.
Here’s how:
- Cash-starved businesses can’t invest. Without predictable income, you can’t plan. You can’t recruit. You can’t scale.
- Delayed payments mean delayed invoices downstream. Subcontractors waiting to be paid delay their own payments to others, creating a knock-on effect.
- It skews business decisions. Companies start choosing clients not on value, but on payment reliability. That high-value contract? Too risky.
What good systems can do
There’s no silver bullet. But technology, used well, can shift the odds.
Digital systems that manage job workflows, invoicing and client communication can:
- Automate payment reminders without sounding aggressive.
- Provide client portals where customers can track and settle invoices easily.
- Integrate with job management so nothing slips through the cracks.
- Time-stamp and proof delivery of jobs, documents, and completion certificates.
This isn't about plugging Joblogic (or any specific provider). It’s about recognising that systems aren't just efficiency tools anymore. They're a form of self-defence. A way to protect what you've already earned.
Beyond tools: a mindset shift
We also need a cultural change. It should not be seen as "pushy" or "awkward" to chase payment. You're not nagging, you're asking for what you're owed!
Larger companies need to look at their supply chain and ask themselves: are we part of the problem? Because if the smallest links in your chain collapse, your whole operation suffers.
Governments and trade bodies are taking notice. Changes are in motion. But small businesses can't wait. Not when cash flow is king and delay is death.
What you can do right now
If you're a small business owner or service provider:
- Set clear terms from day one. Put them in writing. No vagueness.
- Use software to send reminders automatically. Remove the emotional toll.
- Track patterns. Know who pays late and build that into your pricing and decision-making workflows.
- Don’t be afraid to escalate. There are legal protections and late payment interest laws for a reason.
- Talk about it. Shine a light on the issue. Visibility drives change.
If you're a large business using subcontractors or smaller suppliers:
- Review your payment practices, maybe there's a gap in your workflow you're unaware of.
- Ask yourself if you're unintentionally creating risk in your own supply chain.
- Treat prompt payment as a strategic strength, not a favour.
Final word: let’s change the conversation
The conversation around late payment needs to shift. From irritation to impact. From anecdote to economics. From shrugged shoulders to shared accountability.
Prompt payment isn’t just good manners. It’s good business for everyone.
And for small businesses? It’s the difference between stability and struggle.
Let’s stop normalising late payments. Let’s stop calling it a cash flow issue. Let’s call it what it is:
A growth killer.
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