Though late B2B payments are traditionally thought of in the context of a large corporate buyer delaying invoice payment to small suppliers, this week’s B2B Data Digest highlights the variety of scenarios in which B2B payment delays can impact a company’s cash flow.
From one Texas restaurant waiting on funds from Uber Eats, to China’s property development industry facing new regulatory pressure to disclose the use of a tool to delay vendor payments, to a South African city government facing accusations of ongoing vendor payment delays, there is clearly no one-size-fits-all problem — or solution — to the issue of late B2B payments.
$20,000 is reportedly owed by Uber Eats to one Houston restaurant, a case that highlights some of the pain points that can arise for businesses amid a surge in online ordering and third-party delivery services. Local reports said Houston’s Birria Los Primos detailed its challenges with Uber Eats, highlighting the weeks-long saga of having payments from the food ordering platform go through after the restaurant updated its bank account details on the portal. Two months later, the restaurant has claimed that those payments have still failed to land in the restaurant’s account, the total amount accounting for about 700 orders. In a statement, Uber Eats said the company is “working through our standard payment verification process with this restaurant” to resolve the matter, noting that there was a mix-up linked to the restaurant using a third-party platform to sign up for Uber Eats.
24,222 invoices from small suppliers issued remain unpaid by the South African city of Bisho, local reports said. The invoice totals from the last fiscal year amount to nearly $243 million, reports said, noting that previous inquiries into the unpaid invoices in March drew similar conclusions of delayed payments, raising concerns that the city’s investment in an invoice tracking system — designed to help accelerate the government’s accounts payable workflows — had little impact on supplier payment speeds.
$68.9 billion worth of invoices remains unpaid for small and medium-sized businesses in the U.K., the latest analysis from Know-It revealed. Analysts noted that the figure equates to five outstanding invoices for each business, a finding Know-It Founder and CEO Lynne Darcey Quigley described as “worrying,” especially considering how many resources and tools exist to support timely B2B payments. “Offering customers an automated credit management tool method can help mitigate the risk of outstanding invoices and ensure that all invoices are settled within the agreed credit terms,” Quigley noted, adding that these payment delays have caused small businesses to pay their own bills and employees late too.
$556 billion worth of commercial paper issuance in China’s real estate market last year has raised concerns for government regulators, recent Reuters reports said. Commercial paper is a common tool for property developers as a form of payable that assures suppliers of a future payment upon a fixed date. Reports noted that suppliers will typically sell that paper before that date for a small discount in order to unlock that capital more quickly. But there has been a recent increase in late payments among developers that owe their suppliers, particularly among some of the industry’s largest firms, reports said. Now, sources told the publication, the government is promoting transparency in the market and will look to require that these developers disclose their commercial paper debts each month. That disclosure would provide deeper insight into developers’ B2B payment practices and could help suppliers decide which developers to take on as clients.