25 Jan 2011

Small firms suffer as companies take longer to pay bills

12:55 pm on 25 January 2011

Credit reporting agency Dun and Bradstreet says firms' cashflows are likely to remain squeezed this year as the business community tarries over paying their bills.

The latest figures show companies took nearly 44 days to pay their trade accounts during the December quarter.

That compares to 43.5 days in the same period a year ago, and two weeks over the standard 30 day payment term.

An extra 4% of firms failed to pay their bills during the quarter.

Big firms are the worst offenders, and Dun and Bradstreet says smaller firms suffer most as they are more reliant on the money coming in to keep the business going.

Dun and Bradstreet expects the cash flow of firms to remain under pressure in 2011, with an increasing number of firms delaying paying their bills.