New study measures the effects of late payment on small businesses
Chasing invoices costs time, reduces productivity and weakens morale
Late payments continue to hamper small business owners, with many pointing out that getting paid on time is the number one financial challenge, according to new research by cloud accounting software provider Xero. Small and medium enterprises are the most affected by late payments because their cash flows are generally weaker than those of their larger, more established peers. The Xero research, which was released in Cape Town on Thursday, highlights that small business owners spend 1.3 days per month chasing invoices, with the average invoice paid 10 days late. The worst affected sector is healthcare, where businesses spend 2.6 days a month chasing invoices, followed by manufacturing and utilities, and architecture, engineering and building at 1.5 days each. Port Elizabeth businesses are the most affected (1.5 days), ahead of those based in Johannesburg (1.1 days). Xero surveyed 517 small businesses across SA with between 1-20 employees. The research also reveals that: • Late payme...
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