ASBFEO ‘appalled’ by latest payment times figures

late payments, payment times

The latest Payment Times Reporting Regulator report reveals that almost one in four big businesses take more than 120 days to pay their small-business suppliers.

The report notes that, based on the data provided by 7000 businesses – many with a turnover of more than $100 million – seven out of 10 big businesses failed to meet the 30-day payment goal set by the Business Council of Australia.

In particular, 23 per cent of big business has taken more than 120 days to pay their small-business suppliers, nine per cent take between 61 and 90 days, 37 per cent between 31 and 60 days, 18 per cent between 21 and 30 days, and only 13 per cent managed to pay in 20 days or less.

According to the data reported to the regulator, the worst performers were big businesses in manufacturing, retail trade and construction, with only 14 per cent of manufacturing businesses paying their small-business suppliers within 30 days. On the other hand, big businesses operating in public administration and safety fared better on payment times, though still only just over half (54 per cent) of that sector’s small-business invoices were paid within 30 days.

The report also shows that while two-thirds of big businesses adopt standard payment terms of aspiring to pay within 30 days, fewer than one-third met that ambition.

In response to the report, Australian Small Business and Family Enterprise Ombudsman Bruce Billson described the figures “appalling” in a statement.

“I say to the nation’s big businesses who are making small business wait four months to get paid, you can’t be serious,” Billson said. “Good businesses pay. That’s a vital part of business relationships.

“Big business must show leadership, respect and care for our small businesses and pay their bills on time,” Billson added. “And for big-business leaders urging support for small business ‘doing it tough’, a practical and achievable measure is to get serious about improving payment performance to small business.”