The damaging effect of delayed payments to small to medium-sized enterprises (SMEs) from larger corporations is being highlighted in a new campaign by the Business Travel Association.
The association is collaborating with late payment campaign group Good Business Pays (GBP) in a bid to protect small firms from collapse.
The initiative was instigated as the BTA reported that more than 20% of late payments have extended overdue dates, double the debt payback during the pandemic.
More than 50,000 SMEs are forced out of business every year through cash flow problems, according to the association.
An initial whitepaper focuses on instilling and promoting good payment practices among BTA partners and members, as well as the broader UK business community.
The campaign is designed to support BTA members, many of which are classified as SMEs.
It calls for clear payment terms, prompt invoicing and late payment penalties to be implemented to address the challenges posed by late payments.
BTA chief executive Clive Wratten said: “SMEs are critical to the business travel network. However, they are too often left vulnerable to the risk of liquidation due to cashflow problems stemming from late payments by large companies.
“Our partnership with GBP will offer payment guidance to safeguard SME growth and support their activity in the business travel supply chain.”
GBP chief executive Terry Corby added: “It is vital that we do everything we can to protect SMEs in the travel management sector from the problems caused by slow or late paying customers.
“They can only remain in business if they have a healthy cashflow and it’s fair and right that bigger clients pay them fast and on time.
“Good Business Pays will always call out poor payment performance and celebrate those who pay on time. In working with the BTA, we look forward to actively promoting good payment practices – and working with BTA members and partners to drive positive change.”