Waiting Longer For Larger Businesses To Pay You? You're Not Alone
A recent Wall Street Journal article could make some small-business owners feel uneasy, but Victory State Bank believes the importance of it makes it worth reading.
According to the article, “Small Firms' Big Customers Are Slow to Pay,” :
Small businesses are waiting longer for commercial customers to pay their bills as many big companies continue to hoard cash to bolster their own working capital.
The trend, which began in the recession and has worsened in recent years, is putting growing pressure on people like Nirav Sheth, who owns a Web-development company in Washington.
Mr. Sheth's seven-person Anatta Design has been forced to postpone hiring and expansion because of the longer wait for payment. Last year, for example, it sent a $6,600 invoice to an online retailer for several months' work redesigning an online "shopping cart." The entrepreneur, who says he didn't have a credit line to fall back on, received payment in full 404 days after the date on the invoice.
Many small-business owners say they're seeing payments from larger customers stretch from 30 days to 60 and even 90 days after an invoice is issued. The longer wait is taking its toll on the companies, which often have to borrow at costly rates to fill gaps in their cash flow between payments. READ MORE …
About Victory State Bank:
VSB Bancorp, Inc. (NASDAQ: VSBN) is the one-bank holding company for Victory State Bank. As Staten Island, N.Y.’s only community-based commercial bank, Victory State Bank operates five full-service locations on the Island: The main office in the community of Great Kills, and branches in the communities of West Brighton, St. George, Dongan Hills and Rosebank. For additional information, Victory State Bank may be reached at 718-979-1100 or visited online http://www.victorystatebank.com .