The typical victim of late payment in the past six months saw every sixth invoice overdue, with sole traders paid late more often than their larger company counterparts, reports R3.
Figures from the business recovery trade body show that, among companies affected by late payment at all, 15% of invoices were paid late.
Among larger firms with a workforce of over 250 people, the problem was slightly less severe, with approximately every eighth invoice overdue.
But sole traders bore the brunt with 17.3% of their invoices paid late over the last six months.
And a worryingly high 7% of sole traders said between 40 and 50% of their invoices were paid late, while for larger firms this figure stood at just 1%.
R3 vice-president Andrew Tate said: “The consequences of late payments are magnified for smaller companies too: one invoice being paid late will have a disproportionate impact on a very small company compared to a larger counterpart.”
While the statistics are based only on those companies and sole traders who had experienced late payments at all, that group still accounts for very nearly half (49%) of those surveyed.
Just 46% of respondents were confident that they had not experienced any late payment during the last six months before the survey, while the remainder simply did not know.
Mr Tate added: “Late payment puts unnecessary strain on a business’s cash flow, increasing the risk of insolvency. Despite government guidelines and business campaigns, late payment still remains all too common.
“Businesses know how much it costs others to chase down debts, and feel they can still get away with it.”
However, it’s worth remembering that under modern legislation, you can now often reclaim debt recovery costs from the debtor – so this should no longer dissuade you from making enquiries.
In fact, where the cost of taking action might historically have discouraged creditors from doing so, if anything it should now be seen as a further reason why debtors should not allow their invoices to go overdue, as costs and interest can quickly start to magnify the total amount owed.