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Mid-sized firms owed an average of 3.7m in trade debt

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The research from Debt Guard Solicitors found that small and medium businesses as a whole ere owed 6.3tn, with an average of 1.3m each.

This includes general outstanding invoices as well as late payments, but highlights the extent to which Britain’s businesses are indebted to each other.

For mid-sized firms, which employ 50-259 staff members or turn over between 10m and 100m, were owed trade debt worth an average of 13 per cent of their turnover.

This was particularly bad in London, the south-east and Scotland, where businesses were owed an average of 4.7m in trade debt, accounting for 26% of turnover.

The situation is worst for micro businesses, which are owed an average of 68,000, equating to 19 per cent of average turnover.

The average time it took for SMEs to receive payment from customers, known as debtor days, was 63 days for micro-SMEs, 47 days for small companies and 40 days for medium-sized companies.

Mark Burgess, COO at Debt Guard Solicitors, said: This research highlights there is a highly varied national trade debt picture emerging within the SME marketplace, created by unpaid and outstanding invoices.

Related: FPB’s 7 tips for tackling late payments

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