Credit insurer issues warning following Connaught collapse
Trade credit insurer Atradius is warning businesses against complacency after Connaught's insolvency.
The construction giant entered administration this week, leaving thousands of creditors out of pocket.
Marc Henstridge, head of risk at Atradius UK and Ireland, said: "After an economically tough couple of years, it’s tempting for businesses to look at the improving insolvency statistics and presume that we are out of the woods – but the demise of Connaught is a classic cautionary tale.
"But this could be the tip of the iceberg – public spending cuts and other austerity measures mean businesses must continue to be meticulous in their management of trade credit risks, either in-house or by outsourcing their credit management to a trade credit insurer. There are still many potential surprises – and not all of them will be pleasant ones."
In a recent study by Atradius, 57% of British businesses surveyed said that they were experiencing unarranged delays to payment by companies they were supplying, while 59% had been asked for extended payment terms in the past 6 months.
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