13 January 2006 | Rebecca Ellinor

More than 30 per cent of UK companies have been to court to demand payment from businesses in the past year, according to new research.

Results of the study carried out by the Better Payment Practice Group (BPPG) showed of the 292 respondents, 31 per cent had taken firms to court in the past 12 months.

Clive Lewis, head of SME issues at the Institute of Chartered Accountants in England and Wales and member of the BPPG, said there are a number of things suppliers should do before considering stressful and expensive court action.

He advised them to credit check new business customers; agree terms of trade at the outset; invoice promptly; and persistently chase late payments.

Lewis said where court action is the only option, suppliers should check customers have the means to pay by getting a credit rating and details of unpaid county court judgments from a credit reference agency.

BPPG works to promote good payment practice among all UK businesses and organisations, including increasing awareness of the commercial and ethical benefits for all businesses of paying suppliers promptly on agreed terms. CIPS is among its signatories.

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