Late payments: the scourge of many a small business or enterprise. But according to a new piece of research carried out by Liberis, an SME finance provider, the majority of the UK’s smaller firms are spending far too much of their precious time chasing up delinquent creditors.

According to new data collected under the title of “How Is Aged Debt Affecting UK Small Businesses?”, 72 per cent of SMEs are spending up to three days each month chasing money they are owed or other outstanding invoices. That’s the equivalent of one in every ten days.

Not only is this taking up valuable time, but Liberis estimates that it costs the average business £5,000 every year in lost work, revenue and employee effort.

On top of that, a significant proportion – just under a quarter – of SMEs are chasing “aged debt” worth at least £20,000.

On average, the 440 SMEs surveyed by the company were owed an average of £11,000. Extrapolating this using government figures means that the UK’s 5.7 million small business owners are chasing a whopping £14.9bn worth of late payments, money which cannot be reinvested into their businesses.

Over a third of surveyed SMEs say aged debt is affecting their cash flow, with half of all respondents stating that unpaid bills have prevented them from investing in their business. Some of the key issues respondents mentioned were “not being able to buy new equipment”, “not being able to pay or hire staff” and having to “put plans to expand their business on hold”.

Small businesses want to be able to maximise their buying power for greater profitability, but don’t have the initial investment required. Finding that all-important capital can be the difference between succeeding or failing, and will at the very least prevent SMEs from seizing the opportunities placed before them.

Indeed, according to another industry survey carried out by another payment firm Basware, six in ten SMEs want late payments to be regulated, with the majority supporting a 45-day time limit on overdue invoices.

So, for those looking to buy up a business, what are the important takeaways?

The first is to always get a full picture of a potential opportunity’s finances, including so-called “aged debt” and any outstanding invoices it may have. Remember, it is down to a small business to have a robust late payments policy, but could be a few short moves away from unlocking potential revenue streams if led by an experienced business owner.

Second, distressed businesses that folded due to a lack of revenue streams or unreliable income could be the perfect project to turn around and make a source of real growth. When researching businesses for sale, it’s worth examining previous business plans or looking for areas where those running it may have missed out on payments that they need.

Finally, cashflow problems can often be at least partially sorted out with an initial investment, particularly as more credit controls come into play to ensure that businesses are not chasing unpaid bills in the future. Remember, a company in downturn could actually be a profitable business that just needs leadership and a guiding hand.