In a wide ranging report from Market Invoice, searching through its database of 30,000 invoices over 5 years, the proportion of invoices paid late by debtors is shown to have risen steadily from 45% in 2013 to over 60% last year. This contrasts markedly in Europe (excluding the UK), which shows almost the exact opposite trend with 40% of invoices now paid late.
Surprisingly, given the small business czar’s supportive pronouncements, the payment record of the public sector grew much worse last year, from almost on time to 6 days late. However, the report also showed that high street retailers have the worst payment record of any sector or industry Market Invoice studied.
The relatively positive payment news from Europe, hasn’t dissuaded UKIP from entering this debate. UKIP small business spokesperson, Margot Parker was reported in real business as saying that:
“…successive governments… have not done enough to protect … the 5.2m strong community of small businesses in the UK” a group she called the “backbone of our economy” and the “principal driver of our labour market”.
“Bigger companies don’t pay invoices on time, treating the ‘little man’ as a money-lender, ruining their cash flow and potentially putting them out of business.” Parker said.
Parker referred to a recent update from the Asset based Finance Organisation (ABFA), which states that SME manufacturers are forced to wait almost twice as long as larger rivals for invoices to be paid. The ABFA reports a widening gap; whilst the largest manufacturers are paid quicker than last year, smaller businesses still face a wait of 13 weeks and manufacturers with turnover below £1m are hit worst of all – waiting average of 14 weeks for payment.