Late Payments a Growing Problem for Western European Suppliers, Atradius Survey Reveals
In the October 2018 edition of the Atradius Payment Practices Barometer for Western Europe, a survey based on feedback from approximately 3,000 domestic and export suppliers from 13 countries (Austria, Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Spain, Sweden, Switzerland, the Netherlands, and the UK) more respondents than last year (58%, up from 56% one year ago) reported having experienced financial distress on their business due to late payment by their B2B customers.
On average, nearly 42% of the total value of B2B receivables of the Western European businesses surveyed was paid late. This compares to 41% one year ago. Domestically, suppliers surveyed in Italy and Greece were the hardest hit (on average, nearly half of the total value of their B2B invoices were overdue).
The hardest hit by late payment from foreign customers were respondents in the UK and France (53% of the total value of UK and 51% of French export sales on credit were reported to have been unpaid by the due date). Late payment from B2B customers is reflected in a longer days sales outstanding (DSO), which may adversely impact businesses’ liquidity, increasing B2B trade credit risk. Based on the Atradius survey, over the past year, the biggest increases in DSO were recorded in the Netherlands (46 days, up from 41 days) and the UK (35 days, up from 31 days).
The Atradius Payment Practices Barometer for Western Europe also reports businesses’ opinions about the biggest risks to global economic growth in the coming six months. 45% said that US protectionism turning into a trade war is the most likely to dampen economic growth in the upcoming six months. By country, the highest percentage of respondents believing that US protectionism may trigger a global trade war that hampers global growth was recorded in Denmark (60%).