SECTOR INSIGHT
UK LOCKSMITHS LOSE OVER £ 975 A YEAR FROM WITHHELD CUSTOMER PAYMENTS
• 29 % of locksmiths have written off withheld payments as losses
• 14 % say withheld payments have led to difficulties paying employees
» UK LOCKSMITHS LOSE AN AVERAGE of £ 975 every year due to customers withholding payments , according to new research .
A study by IronmongeryDirect , the leading specialist supplier to the trade , surveyed workers across the country to discover the scale of the problem and how it is impacting businesses .
Across the country , locksmiths experience the problem an average of 3.3 times a year , and 29 % have had to write off such debts as losses .
This has led to 14 % of locksmiths struggling to pay their employees or take a wage .
Across all trades , almost a fifth ( 19 %) of workers experience withheld payments five or more times a year , compared to just 12 % when the research was done before in 2021 .
Overall , around four in five ( 79 %) say they have encountered customers who refuse to pay .
On average , each individual loses £ 1,062 of income each year because of such reasons , but many lose far more . One in seven ( 14 %) miss out on over £ 2,000 a year .
Some tradespeople are more vulnerable than others to the problem . Young tradespeople are more likely to be affected , with Millennial ( 25-34s ) and Gen Z ( 18-24s ) reporting the most instances .
Comparing trades , builders are impacted the most , with an average annual loss of £ 1,462 .
The trades most affected by withheld payments are :
1 . Builders - £ 1,462 2 . Plasterers - £ 1,319 3 . Carpenters - £ 1,304 4 . Bricklayers - £ 1,100 5 . Window Fabricators - £ 1,079 6 . Joiners - £ 1,052 7 . Building Surveyors - £ 1,001 8 . Locksmiths - £ 975 9 . Landscapers - £ 940 10 . Caretakers / Maintenance - £ 897 11 . Electricians - £ 815 12 . Scaffolders - £ 775 13 . Plumbers - £ 725 14 . Painter Decorators - £ 699 15 . Roofers - £ 600
Withheld payments can have serious consequences for trade businesses . Almost a quarter ( 24 %) of tradespeople say they have had to write off some debts as losses , and a similar number ( 23 %) say that this has led to difficulties paying their employees .
Other repercussions include cash flow problems ( 18 %), delays paying suppliers ( 12 %) and difficulties taking on new jobs ( 15 %).
Ellis Osborn , Ecommerce Manager at IronmongeryDirect , said : “ Customers withholding payments from tradespeople is a real problem , and it can harm workers and businesses in a wide variety of ways .
“ The most common reason why customers don ’ t pay is that they have their own financial difficulties , but they should not be confirming work with tradespeople if this is the case , as a lot of time , money and effort is wasted . It ’ s also against the law not to give workers the money they are owed , so we ’ ve partnered with a business coach to explain your rights .”
To read expert advice on how to handle unpaid customer invoices , visit : https :// www . ironmongerydirect . co . uk / blog / expert-tips-for-handling-unpaid-invoices
JULY 2024
51
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