Suppliers demand upfront payment

MORE than a quarter of Northern businesses are now being asked to pay upfront for goods and services as suppliers try to safeguard themselves against bad debts.

A survey by insolvency trade body R3  showed 26 per cent of businesses in the North said that their suppliers had been demanding payment in advance. This compares to 15 per cent in other regions.

Matt Dunham, North West regional chair of R3 and a partner at Grant Thornton, said the differences between the regions may be due to northern suppliers taking a more pragmatic approach.

He added: “Suppliers are going back to basics, particularly those in the North. They are taking control of their cashflow and running the business as tightly as possible. However, this can put added pressure on customers.

“Companies which are affected will need to factor this into their cashflow when planning for the year ahead and ensure they have appropriate banking facilities in place.”