Big Boys Slowing Growth for Recruitment Sector

The recruitment sector has named large companies as the worst culprits when it comes to paying their bills on time according to the latest survey results by Cattles Invoice Finance, which found that PLCs were twice as likely as SMEs to delay payment of invoices to businesses.

The study, which involved in-depth interviews with 300 business owners in the UK, found that long standing and overseas customers are the best payers, with only 10% of recruitment companies reporting a problem with payment from these types of customers as opposed to 31% reporting consistent late payment from the larger companies. Surprisingly, the recruitment sector reported Government bodies as being the second worse payers at 17% compared to the survey average of 5.1% across the other sectors.

Although the average payment terms according to the study is 24 days, 43% of recruitment companies reported delayed payments of up to 60 days and the problem of late payment is getting worse, with more than 29% of recruitment companies questioned reporting that invoices were taking longer to be paid than 12 months ago.

Commenting on the findings, Doug Crawford, group managing director of Cattles Invoice Finance, said: It has been well-documented over the past few months that Government legislation for late payment is just not working and our findings highlight the extent of the problem. From the survey it would appear that the best companies to expect early payment from are long standing companies and its concerning to see Government bodies as the second worse payers, as they are not practising what they preach. Those to avoid if you do not want to chase for payment are Government bodies and large companies.