Giving small business owners a chance to vent their concerns

06/12/2014 07:51 AST

mall businesses are seeing a lot of interest coming their way in terms of banks willing to lend and the authorities steadfast in easing the way they go about their operations. But on one count, business owners may not be having much luck — in ensuring that all the monies due to them do get paid and on time.

The extent of these concerns — much more than a niggle, owners will have you know — could soon have more clarity. A local entity is embarking on a survey that will sound out businesses on the extent of the problem they have with late payments. (In some instances, none may be forthcoming despite repeated attempts on the part of the business that is owed the money, but that is a different story altogether.) The survey findings are scheduled for release by mid-January.

‘The late payment of invoices is a major issue facing companies of all sizes throughout the Middle East,” said Nigel Sillitoe, CEO of Insight Discovery, which is helming the survey. “Many of the CEOs I speak to at SMEs say they may as well change their title to “Head of Debt Collection” … the sad part is they aren’t joking.

“Given how important SMEs are to the UAE, the survey will seek feedback from senior management of SMEs. We hope this will open up a debate and alert SMEs to some of the existing solutions, which includes debt collection agencies and factoring companies.”

For the survey, the promoter’s intention is to tap feedback from a minimum of 300 entities, with 75 per cent of the respondents from within the UAE and the others based elsewhere in the Gulf. Respondents can offer their thoughts through both online and over the telephone. “We will of course focus on the top 100 SMEs in the UAE and target other firms through databases in our possession,” said Stilltoe.

Only business owners and chief financial officers at Gulf-based firms are being targeted when it comes to sourcing responses.

Based on the feedback generated, the promoters also hope to come up with workable solutions to take on the crisis. “We (will) explore which options currently exist for companies to chase debtors,” said Stilltoe. “Existing options in the UAE include the courts (often an expensive and a lengthy process), threatening correspondence, licensed debt agencies, invoice discounting and selling the debt to a third-party.

“We will look at some of the best practices in different parts of the world and recommend an action plan. The key findings will examine what SMEs can do if a company fails to pay an invoice and what should happen in the future. The recommendations will be discussed with stakeholders who deal with this issue day in and day out, (and) will include lawyers, consultancy firms and debt collection agencies “The output will be a white paper, which in turn will be circulated to SMEs.”

Gulf News