Belgian companies are not very punctual - Trends-Tendances sur PC

Belgian companies are not very punctual – Trends-Tendances sur PC

There are really few major professional customers who pay their bills on time. “Only 12% of the largest debtors are ahead of schedule”, calculated the research office Altares Dun & Bradstreet, based on the results of a survey of 183,600 Belgian companies.

We have known for a few months now that the number of invoices issued by SMEs, probably doomed to remain unpaid, has increased since the outbreak of the pandemic. In 2018, these outstanding payments concerned 2% of invoices on average. By 2021, the figure had reached an alarming 12%, the SME Barometer revealed. A trend that is confirmed by the new study on payment behavior, called the Payment Study, carried out by Altares Dun & Bradstreet, number one in the Benelux for the collection, processing and supply of data relating to companies. According to this survey devoted to business payments carried out in 14 European countries after the health crisis, 56% of invoices sent to Belgian companies are paid late.

We have known for a few months now that the number of invoices issued by SMEs, probably doomed to remain unpaid, has increased since the outbreak of the pandemic. In 2018, these outstanding payments concerned 2% of invoices on average. By 2021, the figure had reached an alarming 12%, the SME Barometer revealed. A trend that is confirmed by the new study on payment behavior, called the Payment Study, carried out by Altares Dun & Bradstreet, number one in the Benelux for the collection, processing and supply of data relating to companies. According to this survey devoted to business payments carried out in 14 European countries after the health crisis, 56% of invoices sent to Belgian companies are paid late. “This figure seems dramatic, but it must be qualified, underlines Joris Peeters, chief data scientist at Altares Dun & Bradstreet. Some European countries have a payment term set at 60 days, or even 90. With us, it is 30 days, which increases the risk of falling victim to what is considered to be late payment. Perhaps our deadlines are a bit short? It is in Ireland that entrepreneurs have to be the most patient: 32.7% of professional customers pay within the legal deadlines (60 days, Editor’s note). In Switzerland, 71.8% of invoices are paid on time. In the Netherlands, the figure is 72.2%. In Poland, 74.8% and in Slovakia, 76.4%. The prize goes to Denmark, where 90% of companies pay their invoices on time. Why such a gap with Belgium? “It is in particular a question of culture, comments Joris Peeters. Scandinavians are much more punctual in everything than Belgians and other Europeans. Even during the health crisis, they continued to pay their suppliers and partners correctly and on time. in business, which has not always been the case, far from it, here and in the other countries of the Union.” A question of culture, therefore, but also because the Danes know that good accounts make good suppliers, including in times of crisis. Irrespective of the country in which they operate, European large, small and micro businesses display radically different payment behaviors. Our smallest SMEs liquidate their invoices before the due date in 46.9% of cases, a figure which drops to 12.4% for their very big sisters. “These are slower, confirms Joris Peeters. Payments often have to go through a series of processes and be validated by several people; in smaller companies, the procedures are faster and lighter.” But all is not black in the flat country, where only 1.5% of bills are paid over 90 days. Even if other nations do even better. In Denmark, again, and in Finland, this is the case for barely 0.2% of invoices. Belgium is also one of the three countries, among the 14 examined, in which the punctuality of companies is progressing the fastest. In 2019, 39.8% of buyers paid on time, a number that has since increased by 4.2%. At the top of the list is the Netherlands, where 5% more companies than three years ago are punctual. Although 25.8% of Batavian companies show delays. Could the progress recorded by Belgium come from the fact that the legislation has tightened up, closing a certain number of possibilities of letting unpaid debts drag on? Reinforced on February 1, the law concerning the fight against late payment in commercial transactions stipulates, for example, that the payment period now begins to run as soon as the service or product is delivered. And if it authorizes professionals to conclude other agreements, the wait must not exceed 60 days, regardless of the contract or the general conditions of sale. “It is too early to measure the impact of these changes, believes Joris Peeters. The legislator wanted to help companies fight against their liquidity problems, in favor of a healthier business climate, which should encourage investments However, I believe that their influence will only be tangible in the 2023 version of the study.” It also remains to be seen how quickly and diligently Belgian debtors will comply with the new rules. What advice should be given to SMEs and start-ups wishing to convince their large customers to show punctuality? “The bigger the company, the greater its power over its suppliers, replies the expert. It is therefore crucial to conclude clear agreements but also to know the law and the rights it grants to contractors in terms of recovery. invoices and payment deadlines.” Joris Peeters mentions here, among other things, the right to compensation and default interest, as well as the right to recover unpaid products. “SMEs are thus able to control and protect their cash; this is necessary, since they must be able to pay their suppliers themselves.” Doesn’t commercial reality encourage small companies to be more flexible than necessary for fear of losing their big customers? Joris Peeters: “That’s absolutely correct. Could they perhaps federate? If all the SMEs, micro-enterprises and start-ups agreed to denounce the large customers who are chronically late, they would weigh heavily certain in the balance, which could perhaps change things.”

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