Earn
Big businesses under scrutiny for slow payments to small suppliers as new data surfaces
Earn
Big businesses under scrutiny for slow payments to small suppliers as new data surfaces
New data from the Payment Times Reporting Regulator (PTRR) has revealed that large businesses continue to delay payments to small suppliers, despite the growing economic pressures. The PTRR has responded by launching its inaugural Fast Small Business Payer List, aiming to publicly identify companies that are either meeting or failing to meet timely payment obligations.
Big businesses under scrutiny for slow payments to small suppliers as new data surfaces
New data from the Payment Times Reporting Regulator (PTRR) has revealed that large businesses continue to delay payments to small suppliers, despite the growing economic pressures. The PTRR has responded by launching its inaugural Fast Small Business Payer List, aiming to publicly identify companies that are either meeting or failing to meet timely payment obligations.
The release of this list comes as a significant move to address the ongoing issue of delayed payments, which has been a persistent challenge for small and medium-sized businesses (SMBs) in Australia. Ian Boyd, General Manager for ANZ at GoCardless, weighed in on the findings, stating, "Yes, we’ve seen the Payment Times Reporting Regulator’s (PTRR) findings and while positive reinforcement is very nice, negative publicity for the biggest offenders may be what it takes to get real change."
Boyd's comments underscore the frustration felt by many small business owners who have been grappling with the financial strain caused by delayed payments. According to GoCardless's recent Pursuing Payments report, nearly half of all business decision-makers have reported longer wait times for payments compared to the previous year. "Now, we're seeing it reflected in the official numbers, with the slowest payers blowing out from 58 to 64 days," Boyd noted. "It’s clear that the late payment crisis in Australia is accelerating."
The ramifications of these delays extend beyond mere inconvenience. Boyd highlighted the broader economic impact, explaining, "The knock-on effects for our economy are serious. More than a third of SMBs have been forced onto credit cards or loans just to bridge cash flow gaps from late payments alone, effectively paying interest on money they're already owed." This financial juggling act not only affects the immediate cash flow of small businesses but also has a ripple effect throughout the supply chain, as these businesses may then delay payments to their own suppliers.
The situation is exacerbated by the significant amount of time small businesses spend on chasing overdue payments. Boyd pointed out that, "When small businesses are losing an average of 78 hours a year chasing invoices instead of serving customers, that's productive capacity being drained from an already stretched economy." This loss of productivity is particularly concerning as businesses strive to recover and grow amidst a challenging economic landscape.
Despite the grim statistics, Boyd remains optimistic about potential solutions. He advocates for the adoption of technology to streamline payment processes, stating, "The good news is this is a solvable problem. Automating payment collection removes the awkward conversations and manual follow-ups that see so many invoices slip through the cracks." With two-thirds of Australian SMBs expressing interest in adopting such technologies, the challenge now lies in converting this interest into tangible action.
Boyd emphasised the urgency of this transition, warning that without swift action, more businesses could face closure. "The challenge now is turning that interest into action before more businesses are forced to close their doors," he said. The PTRR’s Fast Small Business Payer List could serve as a catalyst for change, encouraging large businesses to prioritise timely payments and adopt more efficient payment systems.
As the economic environment continues to tighten, the pressure is mounting on big businesses to address their payment practices. The PTRR's initiative to publicly name and shame late payers may be a step towards holding these companies accountable, ensuring that small businesses receive the payments they are owed promptly.
RELATED ARTICLES
Salary
GoCardless calls for stronger small business support following rejection of Payday Super extension
GoCardless has urged the federal government to increase support for small businesses after the House of Representatives voted against a proposed amendment to the Payday Super legislation that would ...Read more
Salary
The financial benefits of a diversified income stream
In today’s volatile economic environment, relying solely on a single source of income can be risky. Diversifying your income streams can provide financial stability, reduce the risk of financial ...Read more
Salary
Despite losing top spot, Elon Musk rakes in $400,000 hourly
Elon Musk, the entrepreneur known for his involvement in a wide range of innovative and technological businesses, has recently been dethroned as the wealthiest individual in the world, with Bernard ...Read more
Salary
Rising unemployment and skill shortages prompt Australian businesses to look globally for talent
Australia has witnessed its unemployment rate surging above 4% for the first time in two years, revealed by the latest Labour Force data. Read more
Salary
New findings link job mobility hurdles to stagnant wage growth
Recent research from the e61 Institute has unearthed significant links between slow wage growth in Australia and obstacles to job mobility, including non-compete clauses, complicated occupational ...Read more
Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to ...Read more
Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for ...Read more
Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. Read more
Salary
GoCardless calls for stronger small business support following rejection of Payday Super extension
GoCardless has urged the federal government to increase support for small businesses after the House of Representatives voted against a proposed amendment to the Payday Super legislation that would ...Read more
Salary
The financial benefits of a diversified income stream
In today’s volatile economic environment, relying solely on a single source of income can be risky. Diversifying your income streams can provide financial stability, reduce the risk of financial ...Read more
Salary
Despite losing top spot, Elon Musk rakes in $400,000 hourly
Elon Musk, the entrepreneur known for his involvement in a wide range of innovative and technological businesses, has recently been dethroned as the wealthiest individual in the world, with Bernard ...Read more
Salary
Rising unemployment and skill shortages prompt Australian businesses to look globally for talent
Australia has witnessed its unemployment rate surging above 4% for the first time in two years, revealed by the latest Labour Force data. Read more
Salary
New findings link job mobility hurdles to stagnant wage growth
Recent research from the e61 Institute has unearthed significant links between slow wage growth in Australia and obstacles to job mobility, including non-compete clauses, complicated occupational ...Read more
Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to ...Read more
Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for ...Read more
Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. Read more
