Tightening payment rules on transactions between large companies and small-and-medium-sized businesses (SMEs) could be the key to unlocking growth in the events industry, reports conferencenews.co.uk.
This has been suggested by Marco Forgione, chief executive at creative communication association Eventia-IVCA, who believes larger businesses are being given far too much leeway with the current system.
At present, SMEs in the UK currently have to wait up to 90 days to receive money for services they have delivered. While large companies will typically come good with their promise and pay up before their deadline, Mr Forgione believes the unnecessary delay is slowing Britain’s economic recovery.
Speaking in light of what he described as a “frustrating” meeting at the Bank of England, Mr Forgione commented: “Many small businesses in Britain are having to wait up to 60-90 days to get paid. This creates a huge challenge for them, especially those companies in the creative industries.”
According to eventindustrynews.co.uk, the chief is now calling for chancellor George Osborne to implement “strict new rules” in order to speed up the way small companies have their invoices settled.
Mr Forgione accused the government of only using “warm words” to quell the concerns regarding how large companies treat their supply chain and called for the maximum payment window to be brought forward to 30 days.
“We want the chancellor to introduce strict new rules on payment terms, which will free up SMEs to invest and grow their businesses.”