These staggering findings are revealed in a new White Paper (4 November) in association with the yearly European Payment Index by Intrum Justitia, looking more closely at what sectors are particularly hard hit.
The most important reasons for non-payment or late payment lie in inadequate routines and lack of time and capability of the business community itself when it comes to collecting invoice payments.
Michael Wolf, CEO of Intrum Justitia, finds this worrying. "Businesses are allowing themselves to be blinded by the good economic situation of the past years. In addition they find it awkward to address their customers on the subject of their payment behaviour. They have lost sight of the fact that the banks are responding to the credit crunch by becoming more difficult and expensive when it comes to providing loans".
Intrum Justitia finds that it is absolutely crucial for the business community to take a much stronger line on implementing efficient credit management from front to end. Large businesses are the first to start to pay more slowly. Smaller businesses are forced to follow suit. This has dramatic effects on economic development; forward propulsion is lost because investments are postponed. Company cash is 'frozen' in unpaid invoices and borrowing from banks continues to be difficult and costly.
