It takes an average of 44 days for European companies to get paid for goods or services rendered. In France, that average rises to 52 days, according to a study by Atradius. That's more than six weeks between the moment the sale is concluded and the moment the invoice finally gets paid.
With such a blockage to cash flow, it's no wonder that late and unpaid invoices are the number one cause of bankruptcies in France. The problem is felt most acutely by SMEs, as cash flow is often their lifeblood. Many small business owners will be all too familiar with writing letters and emails reminding customers to honour their side of the bargain.
The job may get finished on time. So why, so often, doesn't the payment?
In France, the government has tried to confront the problem by imposing a maximum 60-day limit for paying a valid invoice. Companies face fines for paying late and can find themselves named and shamed on a public register updated by the competition and consumer regulator, the DGCCRF.
Yet, the problem persists. Outstanding invoices clog up a company's cash flow, sometimes leaving businesses unable to pay suppliers, loans or staff and preventing them from taking advantage of opportunities to grow.
So how can you avoid being paid late for your work? Here are our best tips 👇