More than three-quarters of businesses make late payments to suppliers

More than three-quarters (78%) of businesses in the UK make late payments to suppliers, according to research compiled by Concur.

The poll of 500 companies also revealed that 22% of businesses had either had orders cancelled or seen a relationship with a supplier terminated due to their inability to pay on time.

The problems appear to be related to the fact that one in ten businesses admit they are unable to forecast their cashflow liability due to supplier issues.

But the late payments are seemingly made despite the best efforts of the suppliers to secure the money they’re owed in a timely fashion. One in three say they are contacted by suppliers more than once every day about payments that are owed to them.

>See also: Small business commissioner – scourge of late payers?

Tackling late payments is something the government has highlighted as a priority in its small business policies. It is expected to be a big part of the remit of the new Small Business Commissioner when the office is officially in place.

Concur UK SMB MD David Vine said the research points to a culture in which late payments are being made more than “every now and then”.

“It’s an epidemic that has potential to blight British business and create a significant cash crunch,” he continued. “Is it any wonder that businesses find themselves on the receiving end of pre-emptive action from suppliers when one in ten are effectively operating blind?

“The issue is that every time a business pays a supplier late, it is felt all the way down the supply chain, arguably hitting smaller businesses the hardest.

“As companies face cash flow issues stemming from late payments, many hold on to their funds to meet their most critical obligations. This is money they could be investing in new technology or using to hire staff and grow their businesses.”

Further reading: Six business tips to develop a high-growth mindset

Praseeda Nair

Praseeda Nair

Praseeda was Editor for from 2016 to 2018.

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