“Cash flow problems mostly affect companies in the business to consumer (B2C) segment. In Romania, one of three companies (29%) has had cash flow problems due to unpaid bills or delayed payments,” said Georg Kovacs, general manager of EOS KSI Romania.
The numbers are slightly better from around 31% of Romanian companies that reported cash flow difficulties in 2010.
EOS’ 2011 European Payment Practices survey polled 2,200 companies in 10 countries about prevailing payment practices on the local markets. The polled companies operate in Romania, the UK, Spain, Greece, Russia, Slovakia, Bulgaria, Poland, Germany and Belgium.
According to the survey, Romanian companies report bad debt losses of 4.87% of total receivables. Unpaid receivables in the B2C segment reach 5.9% of total, while their proportion in the business-to-business (B2B) segment is 4.2%.
Another finding of the EON survey is that very few Romanian companies hire professional receivables managers and even fewer use external service providers. Some 70% of the polled companies said they do not use specialized companies to collect bad receivables.
Romanian companies have some of the longest payment deadlines, at 44.5 days on average. Only Greece and Spain have longer deadlines, of 92.2 days and 71.4 days respectively, while German and Russian companies have the shortest terms to settle invoices, of 16.8 and 18.7 days on average respectively.
The long deadlines have a direct impact on unpaid receivables, Kovacs said.
“The sooner you act when payment terms are exceeded the more chances you have to recover receivables, particularly in the B2C segment as companies must use all necessary means to avoid bottlenecks due to unpaid invoices,” he added.