Pictured above: Stephen Woolley

Lawyers at East Midlands firm Robinsons Solicitors have sent out a 10-point credit control advice plan to their commercial clients to help them avoid bad debts.

Robinsons, based in St James Court, Friar Gate, has issued the advice to ensure that companies who are taking on new customers protect themselves against the prospect of not being paid.

The current economic crisis has seen the amount of corporate debt in the UK soar, with smaller companies being hardest hit.

According to the Forum of Private Business (FPB), 18 per cent of small firms report that the problem of late payment and changes to payment terms are getting worse, with on average 36 per cent of a business's turnover tied up in late payment at any one time.

Separate figures from UK financial transaction service Bacs show that Britain's small firms are owed a total of £30bn.

Robinsons' 10 point plan includes researching new customers' companies by checking the legal status of the company and getting trade references and running credit checks, setting a maximum credit limit - and sticking to it - and ensuring invoices are clear, concise and sent on time.

It also advises that companies should always agree payment fees at order stage, consider different payment options to help customers and follow up with a customer as soon as accounts become due.

Stephen Woolley, Head of Robinsons' Commercial Litigation and Dispute Resolution Department, said: "The tough economic climate means that an increasing number of businesses are finding themselves hamstrung by bad debts, at a time when every penny counts.

"Much of our 10 point credit control advice is common sense, but it is timely because many companies may find themselves cutting corners and taking a risk with new customers simply because they need the business.

"There is nothing worse than taking on a new customer only to find that they turn out to be a bad payer - and already indebted to other suppliers. By taking our advice on board, companies could be saving themselves a lot of trouble in the long run."