Owning and running a business is challenging enough without having to worry about chasing late payments from customers. Unfortunately, this is a common issue and companies face a significant threat from overdue invoices. This infographic takes a look at the real cost it has on UK SMEs in 2019.
Let's dive straight into the facts. According to recent figures, £23.4 billion was owed to businesses in late payments in 2019. This is up a staggering £13 billion from 2018. Over half (54%) of SMEs have experienced late payments, and the issue doesn't seem to be going away anytime soon.
Apart from the value owed to businesses, late payments put an extra financial burden on the businesses as £4.4 billion was spent just chasing unpaid invoices from their customers. This puts extra pressure on the business as time and money are spent chasing debt.
Late payments impact the whole business, with 13% of businesses struggle to pay bills. 12% struggle to wages to staff and 10% rely on an SME invoice financing facility to help reduce the risk of late payments.
Late payments are a common problem that small business owners face. Not all businesses survive this pressure. In fact, if all invoices were paid on when they are due, it would save around fifty thousand businesses a year from closure.