Farming News - Signs of cash flow struggles for UK agriculture companies as late payments soar
Signs of cash flow struggles for UK agriculture companies as late payments soar
The global AI-powered Order-to-Cash platform, Sidetrade , reveals that agriculture companies in the UK increasingly paid supplier invoices late in Q2 2022, hinting at possible cash flow struggles within the sector.
The Sidetrade Unpaid Invoice Tracker shows almost one-fifth (17.3%) of invoices issued to UK agriculture companies were deemed overdue* on average in Q2 2022, compared to 12.0% in Q1 2022.
This is the highest level since the height of the pandemic when this ratio stood at 20.7% in Q2 2020. Since then, quarterly payment delays have fluctuated between 9.1%-15.6%.
It also marks the second biggest quarter-to-quarter spike since the start of the pandemic, with a 5.3-point jump between Q1 and Q2 2022.
This news comes in light of recent industry reports from The Andersons Centre showing that "agflation" now stands at 25.3%.
Rob Harvey, Chief Product Officer at Sidetrade , commented: “It’s not surprising to see a rise in the number of late payments in the agriculture sector; one which – according to the latest industry figures - has been particularly hard hit by inflationary pressures, rising costs, and the war in Ukraine.
“This is the first time in two years we’ve seen such a big leap in our data for the sector and may be hinting at possible cash flow troubles behind the scenes for these companies.”
*value % of unpaid invoice 10+ days after their due date out of total outstanding invoices