How supplier pressure builds
Trade creditors are commercial. They weigh recovery cost against the chance of getting paid, and against whether they want to keep you as a customer. That makes them more negotiable than HMRC — and less predictable, because one supplier who has had enough can petition on a debt of £750.
The usual escalation
- Statements and reminders, then the account goes on stop
- Handed to a collection agency, with fees and statutory interest added
- Letter before action, then a County Court claim
- Judgment, then enforcement agents
- Statutory demand, then a winding-up petition
Two things worth checking
Retention of title. Look at your supply terms. Some suppliers keep ownership of goods until they are paid for and can recover unsold stock. It changes what is actually in the company.
Disputed invoices. A genuinely disputed debt is not a proper basis for a statutory demand or a petition. But you have to dispute it in writing, in detail, and promptly. Silence gets treated as acceptance.
Be careful who you pay
When money is short, the instinct is to pay whoever is shouting loudest, or the supplier you know personally, or the one whose debt you have guaranteed. Those are exactly the payments that get looked at and unwound later if the company does not survive. If you are at that point, take advice before deciding the order.
Where a sale fits
Aged creditor balances, unpaid invoices, disputed accounts and contract claims are all within scope. What we need is the aged creditor listing, the correspondence, and a straight account of which relationships are still salvageable.