Based on a recent study from Taulia, 50% of businesses claim they are being paid late by their customers, a drastic increase from 36% in 2021.
Taulia released findings from its “Supplier Sentiment Survey” April 18, which analyzed the views and insights of 9,600 suppliers during November 2022. Amongst responders, only 41% said they were being paid on time by customers. While 3% reported that they were receiving early payments from customers, 6% said they didn't even know when they would be receiving customer payments.
Overall 20% of suppliers said they were receiving payments over 30 days late, up 4% from 2021. Meanwhile, 43% of companies said they are being paid up to 30 days late, a significant upsurge compared to just 29% in 2021.
Late payments also add to the financial pressures impacting suppliers, with 42% saying they expect to face increased borrowing costs over the next 12 months. Almost a tenth (7%) of those surveyed said they expect those costs to grow by at least 10% over the next year.
“With late payments on the rise, and fewer customers paying their suppliers early, it's clear that suppliers have faced some significant difficulties over the last 12 months,” the report concluded. “Late payments place inordinate strain on suppliers' working capital, making it difficult for businesses to meet their own commitments or invest in growth. Indeed, a 2022 survey by the U.K.'s Federation of Small Businesses (FSB) found that 440,000 small firms were at risk of closure due to late payments.”
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