The 10th edition of the Atradius Payment Practices Barometer focuses on Greece, examining the primary aspects of the country’s trade credit supply and management, as well as the payment behaviour of its international and domestic trading companies.
Greece’s volatile economic and financial situation shows through clearly in this survey, which demonstrates how a relatively strong inclination for trading on credit terms can generate a series of protracted payment delays when the trading environment loses its stability.
Greek companies undoubtedly share the preference for trading on credit that charactises other Southern European countries: most notably Italy and Spain. Survey respondents made 66% of B2B transactions on credit terms, a little above the European and survey averages, but also showed caution where necessary. 86% of trade credit went to the domestic market, while 59% of respondents offered no credit terms at all to foreign customers.
41% of domestic receivables were paid past due date and 17% of export invoices fell overdue. A very large 18% of domestic invoices remained unpaid after 90 days, three times the European average. Export delinquencies were reported to be 7.4%. 44% of invoices held by services and medium/large firms fell overdue.
The overwhelming reason for domestic payment delays was an insufficiency of available funds. This was cited by 84% of respondents. Inefficiencies of the banking system and complexity of the payment procedure were highlighted with far less regularity.
At the year’s halfway point, Greek companies were also holding the second highest day sales outstanding in Europe, indicated by respondent data to be some 70 days. Although the manufacturing sector reported a very low DSO, the overall trend was the most unstable in the survey during the first half of 2011. A worrying 46% of the Greek respondents reported an increase in their DSO (Days Sales Outstanding),double the survey average, with pockets of industry including medium/large and micro-companies faring the worst.
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