THE number of overdue invoices in Scotland has reached its highest level for this year, according to new research from R3, the insolvency and restructuring trade body.
R3’s analysis of data provided by Creditsafe shows the number of invoices in Scotland that have gone past their payment deadline rose to 593,114 in October – the highest recorded monthly figure in 2022, and 13,941 more than September’s figure of 579, 173.
The monthly rise in late payments has been mirrored across the UK, with the South East of England and Scotland seeing the biggest jump between September and October rising 4.1% and 2.4% respectively.
The number of Scottish-based firms with overdue invoices on their books has also risen, with 101,835 companies failing to meet payments on time between August and October – an increase of 1,016 companies from the previous three months.
Richard Bathgate, Chair of insolvency and restructuring trade body R3 in Scotland, says: “The increase in late payments we’ve seen in October 2022 suggests that more and more businesses are either financially distressed or potentially concerned about their cash flows and that more businesses – those on the receiving end of the late payment – are going to potentially have issues paying their own staff and suppliers.
Richard, who is Restructuring Partner at Johnston Carmichael, continues: “Those businesses that are struggling – whether that’s because they’re behind on payments or because they’re waiting for overdue invoices to be paid –need to have a contingency plan in place for mitigating the issue.
“I urge any directors worried about their company’s cash flows or finances to seek advice from a qualified restructuring professional as soon as they can. It can take courage but having an early discussion whilst pressures in the business aren’t severe can be the difference between a successful turnaround or a decline into financial distress. You won’t know what tools are available in the toolkit of a restructuring professional unless you ask and if anyone knows how to avoid an insolvency it’s professionals who deal with them every day.”