According to data from UK finance company, MarketInvoice, Australian companies are the slowest in the world at paying invoices.
MarketInvoice assessed 30,000 invoices from 1000 companies in 80 countries over five years to put together its Late Payment Report 2016, and found that globally, 72.5 per cent of invoices are paid late.
The average amount of time it takes for an invoice to be paid in Australia is 26.4 days overdue. In Mexico, the second-worst country, the average is 18.6 days overdue. The fastest-paying countries in the world are Japan (an average of 6.5 days early), Belgium (4.1 days early) and the Netherlands (3 days).
“The payment records of SMEs and bluechips are more similar than one would expect. However, SMEs tend to pay far more sporadically, often very late or very early,” the report says. “This would suggest an ad hoc attitude to payment, or a deliberate delay for the sake of cash flow. There is also the possibility that SMEs are merely passing on a payment problem from the top of the chain.”
When it comes to specific sectors, banks were the earliest payers, paying on average 0.3 days after a bill is due. Tech companies were next, paying 1.7 days after a bill is due, and the FTSE 350 rounds out the top three, paying four days after a bill is due. At the other end of the spectrum, supermarkets and e-commerce retailers tend to pay more than a week late, while high-street retailers are the worst, paying bills 14 days late. .
While the research was UK-focussed, CEO and co-founder of MarketInvoice Anil Stocker says “the simple act of not getting paid when you should has an adverse effect on the success of any company.”