Sunday, July 21, 2024
HomeEconomyPortuguese companies spend more than 10 hours a week trying to recover...

Portuguese companies spend more than 10 hours a week trying to recover late payments – Executive Summary

Published on

The majority of Portuguese companies prioritize efficiency and liquidity in response to economic uncertainty and geopolitical instability.

According to the study EPR2024 – European Payment Report, conducted by Intrum, in 2023, 66% of Portuguese companies implemented measures to reduce costs and improve efficiency. Furthermore, 53% of companies have redirected their focus from growth to cost reduction. For 2024, this trend will continue, with liquidity remaining a key priority.

However, the scenario is complex. Geopolitical instability and rising borrowing costs are creating an environment of caution. More than half of companies (54%) expect interest rates to continue to rise, which will affect their financing and spending plans. Moreover, 42% of companies remain cautious regarding their business expansion prospects.

Despite the challenges, 22% of companies recorded growth in their annual revenues exceeding expectations during the past three years. For 57% of companies, growth in 2024 is a top priority, with improving financial health seen as a path to new strategic opportunities.

The study also highlights that 63% of companies see the development of new digital business models, such as online services, as a viable opportunity within the next two to three years.

Despite some positive signs, deteriorating payments discipline remains a major problem. 63% of businesses realize that late payments impact their cash flows, impacting their ability to pay suppliers in a timely manner. This behavior creates a vicious cycle, where late suppliers have difficulties paying their suppliers, increasing problems along the chain.

In 2024, 38% of Portuguese companies admitted to paying their suppliers later than they accept from their customers, an increase compared to 29% in 2021. Half of companies (43%) rarely take into account the negative impact of these delays.

See also  “The European Union is losing the global innovation race”

However, 60% of companies have identified improving payment practices as a strategic priority for 2024, seeking to ensure timely payments.

The European Parliament has approved new regulations requiring 30-day payment deadlines, with greater automatic compensation for late-paid invoices. These measures aim to protect SMEs and encourage stricter payment practices.

In Portugal, companies spend an average of 10.27 hours per week trying to recover late payments, a slight decrease compared to 10.56 hours in 2023. This situation represents a significant loss of time that could be directed towards core activities, growth and innovation.

Latest articles

More like this