This areticle dosn't give much hope for those Brits who are trying to set up a Business? (From the echo today)

Every one in six Bulgarian companies is facing liquidity trouble because of losses accumulated from delayed payments by partners and customers, according to a survey by international debt management group EOS Matrix on payment habits across Europe in 2009.

Polling 1200 firms in Bulgaria, Hungary, Germany, the UK and Switzerland to find out that bankruptcy because of unpaid debts looms largest over Hungary, where one in three companies are treading on shaky ground. At the other end of the scale, only one in 10 companies is under risk of bankruptcy in Germany and Switzerland.

However, executives in all countries where the polls was done predicted insolvencies will spiral off among both companies and individuals over the next two years.

The report highlights the severity of the issue with outstanding debts for Bulgarian businesses. With 16 per cent of their receivables still due, Bulgarian companies occupy the notorious top spot, lagging behind with almost every other bill. Thus, local companies write off and lose four per cent of their total receivables against a much more humble 1.4 per cent for the UK and Switzerland, for instance.

Payment difficulties worsen companies’ problems with securing working capital. Clogged access to funding was singled out as the biggest obstacle for Bulgarian businesses in the annual survey &
quot;
Global Economic Competitiveness Report 2008-2009&
quot;
of the World Economic Forum in Davos published yesterday. Last year it was only eight in the list of factors blocking business making in Bulgaria.

Intercompany debt is indeed a complicated problem but it should not be exaggerated, according to Evgenii Ivanov, executive director of the Confederation of Employers and Industrialists in Bulgaria (CEIBG). Speaking to Dnevnik, he repeated a proposal by the organisation made last year to put in place a receivables set-off system to enable companies to pay down a portion of its debts to other firms, eliminating the need to have cash at their disposal.

The issue of intercompany debt is further aggravated by delayed payments by the state, said Vassil Velev, board chairman of the Bulgarian Industrial Capital Association (BICA), who called for a speedier insolvency procedure.

Hi Sarah,

I agree with you, but if we brits don't take credit, we can make it through. Only accept payments up front we can keep going. Once credit is employed either with client or by company then there is no chance of survival.

With much care, we can get throught this, but it will not be an easy task for any of us. But it will take care and planing to make it through, much careful thought as well.

The situation is much worse now. 2011 is supposed to be a record year for BG company bankruptcies.