Some new research by Neopost has revealed that invoices are still causing a huge problem for UK SMEs.
Invoices make up nearly a third of all SMEs outgoing communications and the majority of SMEs are struggling to work their way through the current invoicing processes.
One major problem that invoices cause is time consumption and 77% of the 280 SMEs that took part in the survey said that they manually add information to each of their invoices.
Another 22% admitted they didn’t know whether or definitely did not track their invoices, hampering their ability to identify and chase late payers.
Erwan Kernevez, digital solutions director at Neopost, said:
"These statistics clearly indicate that too many small businesses still rely on inefficient, unsustainable invoicing procedures. While it's true that invoice recipients have a duty to pay them on time, SMEs need to do everything they possibly can to get paid on time - and this means optimising their entire invoicing process.
“In such a fast-paced business environment, where time is of the essence, firms simply cannot afford to take time and resources away from their key business activities in order to support mundane tasks, such as manually amending or tracking invoices.”
Invoice financing is where a third party agrees to buy your unpaid invoices for a fee. Two of the major invoicing platforms in the UK are Market Invoice and Platform Black and both have the right skills to help complete invoices quicker and easier.
One major benefit that invoice financing companies bring to the SME sector is that they don’t make a lending judgment on the following:
- Balance sheet
- Profit and loss account
- Historic trading levels
Borrowers should be able to receive their funds as long as the investor has a fairly good credit rating.
Invoice financing in the UK is the largest in the world and has been for many years. Barry Rodgers said:
“Invoice financing provides the SME businessman with a fantastic opportunity to obtain equitable funding at reasonable rates without having to pledge collateral which many SME’s simply do not have or unable to give.”