Late Payment: Small Businesses showing the way
Posted on by James
Estimated read time: 2 mins
The quarterly Late Payment Index from Experian revealed the UK’s largest businesses are paying their overdue bills on average 15 days later than their smallest counterparts. When compared to the same quarter last year, the UK’s largest companies (501+ employees) experienced the highest annual increase from 32.18 days beyond terms in Q3 2012 up to 35.40 in Q3 2013 – an increase of three days.
The UK wide picture, however, shows a relatively stable environment with UK businesses paying their overdue bills between July and September 25 days late on average, only marginally slower than both the last quarter (24.58) and the same period last year (24.88). This was led by the UK’s smallest companies (with 1-2 employees) who were paying their late invoices 20.62 days beyond terms in Q3 2013 – only slightly later than last year’s figure of 20.36 days. This was still four days faster than the national average and 15 days ahead of the UK’s biggest firms.
Ade Potts, Managing Director for Experian Business Express, said: “Our analysis shows that late payment is creeping up again, especially at the larger end of the business world. There are steps SMEs can take to increase their chances of getting paid faster and a great place to start is credit monitoring. This will help to differentiate between those debtors that are unable to pay, those that have the means to pay but have a track record of paying late and those that are willing and able. Identifying these customers is the first step to devising a strategy for getting paid.”