EOS survey reveals that one in five European companies fears for its survival - EOS Group
Hamburg, October 6, 2022

  • Almost one in four companies expects payment practices to deteriorate
  • In Western Europe, every fifth invoice is paid late, in Eastern Europe as many as one in four.
Payment practices in Europe have deteriorated in the last three years: At around one in five companies, this development is leading to fears about viability. These were some of the findings from the meanwhile 13th representative EOS Survey “European Payment Practices”, which polled 3,200 companies in 16 European countries.

Although companies had been offering extended payment terms, private customers in particular were paying their bills 19 days late on average. Compared with the previous survey from 2019, where 16 percent of invoices were paid late or not paid at all by private customers, this figure had risen to 20 percent in the current survey. The companies polled cited short-term cash flow problems on the part of their customers as the main reason for these poor payment practices.

The main consequences of these payment delays and backlogs were that companies had to deal with their own liquidity issues (42 percent) and profit shortfalls (51 percent). To compensate, around a third of companies had to reduce their investments and raise prices. Accordingly, companies have a bleak view of the future. Whereas in 2019, 22 percent of survey respondents still assumed that payment practices would improve, 24 percent of the current respondents believe that they are going to get even worse. Especially in Denmark, Switzerland, Slovakia, the Czech Republic, Slovenia and Bulgaria, the forecasts were particularly subdued. “It is concerning that payment practices have deteriorated significantly, especially because in the light of the current economic figures and high inflation we have to expect a further decline in payment behaviour,” says Marwin Ramcke, CEO of the EOS Group.

Professionalization in receivables management

More and more companies are working with external receivables management service providers to recover debts. “Lack of liquidity is one of the most common causes of insolvency and the loss of jobs.” European companies should therefore continue to professionalize their receivables management and look into working with external partners, Ramcke recommends.  

Eastern Europe is a particular front runner when it comes to professionalizing receivables management. Around half of the companies in the region are already relying on the support of external specialists. “Especially in view of the challenging economic figures, debt collection providers offer valuable support to companies and the economic system, because they restore liquidity,” says Christina Schulz, who heads Division Management Eastern Europe at EOS. 

Increase in digital payment methods 

At the same time, expanding the digital payment methods they offer is becoming increasingly relevant for companies. Since 2019, there has been a significant raise in the availability of such options in Eastern and Western Europe, with companies in Eastern Europe almost doubling their digital payment offerings with an increase of 20 percentage points. The payment method “Buy Now, Pay Later” (BNPL) is also gaining ground: four out of ten European companies regard this payment method as the new credit card and a must in the range of payment options offered.

About the EOS Survey “European Payment Practices” 

In partnership with independent market research institute Kantar, EOS conducted phone interviews with 3,200 companies in 16 European countries between March 4 and April 19, 2022, to ask them about the prevailing payment practices in their respective locations. 200 companies (each with an annual turnover of more than EUR 5 million) in each of the countries Belgium, Bulgaria, the Czech Republic, Croatia, Denmark, France, Germany, Greece, Hungary, Poland, Romania, Slovakia, Slovenia, Spain, Switzerland, and the UK answered questions about their own payment experiences and current issues relating to risk and receivables management. This is the 13th time that EOS has conducted the survey.

Contact for press and media:
Sarah El Jobeili, Corporate Communications & Marketing EOS Group
Email: presse@eos-solutions.com
Tel: +49 40 2850 1222