By Louise Oakley
Payments owed exceed $1m for 9% of respondents - Hotelier Middle East poll.
More than 70 percent of hotel suppliers are owed money from hotel companies that have not yet paid for services rendered, according to the results of a new survey.
Out of a sample of 34, 70.4 percent of respondents said they were owed money from hotels, said the Hotelier Middle East Supplier Survey.
For 22.9 percent of respondents, outstanding debts owed to their company was the biggest challenge facing their business as a result of the economic downturn.
The fees varied dramatically but for 8.8 percent of respondents, payments owed exceeded $1 million.
More than a third (35.2 percent) of companies said they were owed in excess of $100,000.
Overall, almost 80% of respondents strongly agreed or agreed that “it is taking longer than ever to receive payment from hotels for suppliers services”.
However, the majority of the suppliers questioned do expect to receive payment.
Three quarters (75.8 percent) said they believed they would “definitely” get the payment or that they were “very confident” of receiving payment.
Of the remainder, 15.2 percent said they thought they “might receive payment”, 3 percent said they were “not very confident of receiving payment”, and 6.1 percent said they “do not expect to receive payment”.
If they do not receive outstanding payments, 13.9 percent of 36 respondents said that they faced the risk of having to close their company.
That's not a very good sign at all, things must be much worse than people admit to if the hotels can't even pay their suppliers on time. It does'nt take much skill to run a company and lose money....anyone can do that.