In the last financial year, research suggests that SMEs throughout Britain, wrote off a combined debt of £5.8bn.
Of the 728 companies who took part in the research, more than 80% still have on their books outstanding balances from their debtors. Of those surveyed, the average outstanding balance owed is £63k.
It is estimated that 40% of SMEs who have written off unpaid debts during the last financial year, were unable to identify the level of monies owed by their debtors.
29% of those surveyed had decided to write off the debts due to the fact that the debtor had become insolvent and unable to pay its debts. A number of SMEs were also concerned that they did not want to disrupt their ongoing relationship with their customers and they did not have the time to chase up the outstanding debts.
It is estimated that 7,000 companies have gone into liquidation in the first half of 2016 and therefore there is a tremendous knock on effect when having to write off money due from these companies.
We recognise that SMEs don’t always have the time to follow these debts up when a company goes into some form of insolvency and, will often simply write the debt off.
At Poppleton & Appleby , we have a dedicated creditor representation service which alleviates SMEs, finance directors, etc. from having to oversee the formalities of claiming in the proceedings, attending meetings of creditors and pursuing, where possible, retention of title claims. We are more than happy to attend meetings of creditors for and on behalf of creditors as we already act for many companies throughout the country in most industries and therefore we would attend on your behalf and report back to you on the outcome of any meetings and provide you with an indication of what is likely to be recovered from the insolvent estate and to ensure that the insolvency practitioner appointed acts in the best interests of all creditors.
If this service is of interest to you or you wish to discuss any of the above, then please do not hesitate to contact us.