Late payments exert a substantial toll on UK SMEs, costing them about £22,000 annually and resulting in 56 million hours of lost productivity. The FSB highlights this as a critical issue for small businesses, prompting the government to consider stricter regulations to facilitate timely payments. An analysis indicates that the manufacturing sector endures the longest payment delays at 47 days. In contrast, the wholesale and retail sector and agriculture industry experience 36-day waits, resulting in significant operational strain, particularly given their financial constraints and reliance on timely cash flow.
Late payments cost SMEs £22,000 yearly and create 56 million hours of lost productivity, prompting government plans to enforce stricter payment laws.
The manufacturing sector faces the longest wait for payments, averaging 47 days, likely due to complex supply chains impacting payment speed.
The wholesale and retail trade sector has a median payment wait of 36 days, where businesses rely on credits and assess product performance before paying.
Agriculture, forestry, and fishing sectors also experience 36-day payment delays, worsened by their seasonal cycles of production affecting cash flow.
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