Chasing late payments, rising operating costs strikes fear into business owners, and security for the transport sector
Today we guide you through how to avoid late payments in a bid to avoid cash flow issues, the fear caused by rising operating costs, and new transport security funding for UK companies.
Avoiding late payments with an invoicing strategy
For Small to Medium-Sized Enterprises (SMEs), the issue of late payments can mean the difference between survival or liquidation. The Department for Business & Trade estimates it costs the economy £11 billion annually, forcing 38 businesses to close their doors every day.
The government is taking steps to change this, with the Commercial Payments Bill having its first reading in the House of Lords in May 2026. It proposes a 60-day hard cap on business-to-business payment terms, new powers for the Small Business Commissioner to fine persistent late payers and a requirement for the boards of large businesses with poor payment records to publish an explanation of how they intend to improve.
But companies need to ensure they have robust procedures for collecting money owed on invoices, as cash flow is the blood of the business. There are steps to take.
For SMEs, the advice is remarkably consistent: make it easy to pay, make expectations clear and follow up systematically.
1. Agree payment terms before starting work
Set out payment terms in writing before work begins. This should include due dates, payment methods and what happens if invoices become overdue. Clear, documented terms reduce disputes and payment delays.
2. Invoice promptly
Invoice as soon as goods or services are delivered rather than waiting until month-end. The quicker the invoice is issued, the sooner the payment clock starts.
3. Make invoices accurate and easy to understand
Ensure that invoices clearly contain all required information, including purchase order numbers, contact details, payment instructions, due dates and a clear description of the work carried out.
4. Offer convenient payment options
Offer customers multiple ways to pay, such as bank transfer, card payment, online payment links or direct debit.
5. Check customer creditworthiness
Before taking on a new customer, conduct credit checks and basic due diligence. This includes previous bankruptcies or a string of liquidated companies. This helps avoid future bad debts.
6. Ask for deposits or staged payments
For larger projects, and certainly those that might strain the company’s resources, request a deposit upfront and agree on milestone payments. This reduces financial exposure.
7. Automate reminders and follow-up
Use accounting software to send automatic reminders before and after payment due dates. Many late payments are simply the result of oversight rather than unwillingness to pay. This involves a structured credit control process:
- Reminder before due date.
- Reminder on due date.
- Follow-up email or call after the due date.
- Escalation procedures for persistent non-payers.
9. Build strong customer relationships
Maintaining regular communication with your customers can help resolve invoice queries quickly.
10. Use your legal rights when necessary
Companies must be prepared to exercise legal muscle when required. Businesses may be entitled to charge statutory interest and claim debt recovery costs on overdue invoices, subject to relevant rules and contractual terms. Just making customers aware of these rights can encourage payment.
A summary of best practice
Many successful SMEs follow this sequence:
- Credit check new customers.
- Agree terms in writing.
- Take a deposit where appropriate.
- Invoice immediately.
- Include a payment link.
- Send automated reminders three to five days before the due date.
- Phone the customer within a few days of any missed payment.
- Escalate quickly if payment remains outstanding.
If you need help with your invoicing and collections strategy, please contact us. We’re here to help.
Business concerns over costs hit record highs as AI adoption accelerates
UK businesses are increasingly worried about rising operating costs, with concern over both energy and fuel prices reaching their highest levels since the Office for National Statistics (ONS) began tracking them.
The latest ONS data came as the International Monetary Fund (IMF) reported that the UK economy would expand faster than expected – 1.3% in 2026, up from the 1% it predicted in July. But like the ONS, it said that despite encouraging figures, higher energy prices and interest rates will hit the economy in 2027.
The findings suggest UK businesses are facing a combination of rising cost pressures, ongoing supply chain uncertainty and growing climate-related concerns, while at the same time accelerating their investment in AI technologies.
ONS data for late September 2026 show that 72% of businesses were concerned about energy prices, the highest proportion recorded since the question was introduced in March 2026. The accommodation and food services sector reported the greatest level of anxiety, with 91% of firms expressing concern.
Worries about fuel costs were even more widespread. Nearly three-quarters of businesses (73%) said they were concerned about increases in fuel prices, the highest figure since the measure was introduced in May 2026. Businesses in the transport and storage sector were particularly affected, with 60% describing themselves as ‘very concerned’.
Supply chain questions
International conflict emerged as the most commonly cited risk to supply chains, with 32% of businesses mentioning it, along with shipping disruption at 21%. Almost half (48%) of businesses employing 10 or more people reported concerns about at least one factor that could affect supply chains, including climate issues, over the next year. While this was little changed from August, it was 17 percentage points higher than a year earlier.
Concerns about environmental risks are rising, with 41% of firms expressing worries about the potential impact of climate change on their operations. This is the highest level recorded since February 2023.
AI use increases
The ONS found use of Artificial Intelligence (AI) continues to grow rapidly across the economy. Around 30% of businesses reported using at least one form of AI technology in September 2026, more than triple the 9% recorded when the question was first asked in September 2023. Adoption is particularly strong among larger organisations, with 51% of businesses employing 250 or more staff now using AI, compared to 19% three years ago.
Among AI users with at least 10 employees, administrative and clerical roles were most likely to be affected by the technology. Some 38% of businesses identified these occupations as the most impacted, up from 35% in June 2026 and 29% when the question was introduced in December 2025.
To read the full report, go to: https://www.ons.gov.uk/businessindustryandtrade/business/businessservices/bulletins/businessinsightsandimpactontheukeconomy/latest
New transport security funding for UK companies
Small UK companies are being asked to develop security ideas and products for Britain’s transport sector with an unusually tight deadline. As the geopolitical situation becomes increasingly dangerous, with sabotage to the UK’s physical and cyber infrastructure by countries such as Russia and Iran increasing daily, new security projects are topping the government’s ‘hopeful’ list.
A second cycle of the UK’s Security Open Call has been launched by UK Defence Innovation (UKDI), with the addition of areas focused on by the Department for Transport (DfT) and successful proposals can access funding up to £350,000.
Submissions for stage one have a deadline of 29 October 2026.
Cycle 2 of the Security Open Call is now looking for technologies that can detect threats, improve screening and protect passengers and goods, while keeping the UK moving.
The funding opportunities follow on from Cycle 1, which sought ideas for Home Office and National Protective Security Authority (NPSA) priorities including cyber resilience, border security and protective security technologies. The Department for Transport (DfT) focus areas are a new addition alongside the Home Office and National Protective Security Authority projects.
What innovations
This Open Call is looking for ‘innovative’ technologies and approaches to areas such as:
- Aviation hold baggage screening.
- Detection of explosive threats in complex freight and large loads.
- Low divestment walk-through people and bag screening.
- Security situational awareness sensor integration with autonomous and robotic platforms.
- Passenger screening – alarm resolution.
Overall, the solutions should improve the detection of malicious threats, support screening operators through automation by exploiting emerging technologies to enhance the security and resilience of the UK’s transport network.
Application process
The Security Open Call uses a two-stage application process to identify promising ideas at pace. Applicants will first submit a Stage 1 overview proposal. Ideas that align well with the Competition Focus Areas, demonstrate a strong chance of successful delivery and meet the customer’s needs will be invited to progress to a full Stage 2 submission.
UKDI’s Innovation Partners are available to support innovators throughout the application process.
Funding available
Successful proposals can be funded up to £350,000. Projects can run for a maximum of 12 months, with an optional testing and trialling phase costed into proposals to extend activity to 18 months.
Submissions to Stage 1 will close at midday on 29 October (GMT). Please see the full competition document for full details of stages and submission dates.
The full competition document can be found here: https://www.gov.uk/government/publications/competition-document-ukdi-security-open-call-2026-cycle-2
Further information on working with UK Defence Innovation (UKDI) can be found here: https://www.gov.uk/guidance/how-to-work-with-uk-defence-innovation-ukdi#advice-and-guidance-contact-your-local-innovation-partner