"In the wake of one of the worst holiday spending seasons on record, more retailers are squeezing their suppliers by extending payment schedules, Debtwire reports. The tug-of-war over the issue %u2013 and the disappearance of credit insurance %u2013 has sent vendors scurrying through a mousetrap full of retail bankruptcies, no-win negotiations and dwindling choices."

"Interest free loans! Sounds great doesn't it? Well that's what businesses do when they offer credit terms to their customers. Sure it's considered normal to allow a customer thirty days to get their bookkeeping in order to pay the bills. But very large companies especially, take advantage of this largesse and take 60 - 90 days to pay an invoice. That becomes 3 months of interest free money. Your money. You are essentially helping to grow their company using your resources."

Art of Factoring Blog Archive Free Money!

Well, this is all very true but is factoring the answer? Only the business owner can make the final decision, but before they do, explore all the options available.

"The commercial world is tightening its belt. Major Banks are reporting a growing number of British firms have fallen behind with their repayments. Business debt collection is more important than ever to prevent cash flow issues. This has led to larger companies getting more aggressive and:

1) forcing extended credit terms on suppliers

2) demanding discounts on already agreed prices

3) demanding settlement discounts for just paying on time

4) Imposing retrospective rebates for goods already delivered.

5) Using late payment as an easy way of funding their own cash flows.

These are extremely worrying developments for the whole business community."

"The companies are hugely dependent on their cash flows. But if they push their slow payers too hard, they risk losing customers. Hiring collection attorneys is also expensive, and if late payers are pushed into bankruptcy, their small-business creditors may find themselves empty-handed, waiting at the end of a long queue."

This Wall Street Journal item is very timely and will apply equally to Australian small business this year. If you are a small business owner, then think these issues through very carefully and act now

To Help Collect the Bills, Firms Try the Soft Touch - WSJ.com

Could not help but point out this item as a sign of the times in the UK. Hope this does not happen here in Australia.

The article keeps referring to credit controllers but I think the author really means debt collectors.

Birmingham arcade traders protest against aggressive baliff tactics - Birmingham Mail

"04. Call / email accounts 45 days or more overdue."

"you try something, if it doesn't work, you try something else."