Getting paid is the lifeline of business, so when you deal with a company, the bottom line you need to know is whether or not they can pay you for your product or services. The UK has a growing trend for late payments, but what if you deal internationally? Creditsafe have recently conducted research into UK company invoices issued to international companies and the findings have revealed Saudi Arabian countries take an average of 92 days beyond terms (DBT) to pay invoices to their UK counterparts.
Creditsafe used our trade payment data databases to analyse over 283,000 UK invoices for companies across all 18 of the G20 countries outside of the UK. The results show that on average, it takes 19 DBT for a company from a G20 country to settle invoices with UK businesses.
The best G20 country to trade with based on the findings is Brazil, with Brazilian companies taking an average of just one DBT to pay UK firms. The G20’s other South American representative also emerges credibly, with Argentinean businesses paying UK firms two DBT on average.
By way of comparison, UK businesses take an average of 13 DBT to pay their fellow G20 partners, with 30 days being the average standard payment terms set by UK businesses.
The findings also revealed that so far in 2016, French businesses have received the most invoices from UK companies (nearly 80,000), settling payments 16 DBT on average. Meanwhile, Indonesian businesses have had the fewest invoices (187) from UK firms in terms of G20 members, paying these nine DBT on average.
While clearly there are a vast number of factors that UK businesses should take into consideration before trading overseas, our findings do highlight one particularly critical aspect in terms of speed of payment. We advise that all businesses carry out thorough checks on all of the potential companies they will be working with, both here at home as well as abroad.
UK firms are continually looking to identify new regions to expand operations into and businesses on the ground to work with, which is something we would absolutely encourage. However, we would always caveat this by advising that businesses use all of the information available through reports such as ours to make the most informed choices on who to work with.
We also did an analysis of members of the EU.
Of these, Greece emerged as the worst country for UK companies to do business with, as Greek businesses take an average of 78 DBT to pay. This compares to an average of 20 days across all other EU countries outside of the UK, with Austria ranked as the best country to do business with at 7 DBT to settle invoices on average.
Do you trade internationally? If you know when a payment is going to come in, you can manage your own cashflow accordingly. By seeing a potential customer’s payment behaviour you forecast your cashflow if they are going to be a slow payer, helping you avoid being left short on money for your business and paying your own suppliers late.
Creditsafe’s international company credit reports can be your safety net in the global world. Request a free report!